Citigroup Turns Bullish on On Holding AG—What’s Driving the Upgrade and Market Opportunity?

In a move that’s turning heads across the consumer discretionary sector, Citigroup has upgraded On Holding AG (ONON) from Neutral to Buy, setting a new price target of $60—significantly above its recent trading price of $46.51. This upgrade comes at a pivotal moment for the Swiss performance sportswear company, which has rapidly transformed from a niche running brand into a global lifestyle juggernaut. For sophisticated investors, the significance of this analyst action is underscored by the potential for a 29% upside and the weight that Citigroup’s global research team brings to the table.

On Holding AG, best known for its innovative CloudTec® running shoes and strong athlete endorsements, has leveraged direct-to-consumer and wholesale distribution to achieve robust growth. The company’s focus on premium branding, technological differentiation, and expansion into new categories (such as apparel and outdoor) positions it as a disruptor in the $300+ billion global sportswear market—territory dominated by giants like Nike and Adidas. Analyst upgrades from major institutions often serve as catalysts for both institutional and retail flows, making today’s rating shift a critical market signal.

Key Takeaways:

• Potential 29% Upside: Citigroup’s $60 price target implies a 29% upside from the current price of $46.51.

• Recent Stock Momentum: Shares are up over 3% in early trading today, continuing a positive trend since the start of 2025.

• Key News Events: On was recently added to Zacks’ #1 (Strong Buy) list, and broader macro headlines—such as US-China trade tensions—are affecting the sector.

• Volume and Technicals: Despite high volatility and above-market-average daily volume, technical indicators suggest the stock is in a momentum phase, with RSI near 64 and price hugging the upper Bollinger Band.

• Analyst Credibility: Citigroup’s coverage is highly influential in global consumer and retail, signaling strong conviction in On’s growth trajectory.

Analyst Upgrade: Citigroup’s Endorsement Carries Global Weight

Why Citigroup’s Upgrade Matters

Citigroup, a leading force in global equities research, brings considerable clout with its coverage of consumer retail and discretionary stocks. The firm’s upgrade from Neutral to Buy is not a token shift—Citigroup is known for its rigorous quantitative and qualitative frameworks, as well as its ability to move markets, especially in sectors with emerging growth stories.

• Previous Rating: Neutral

• New Rating: Buy

• Previous Price Target: Not specified

• New Price Target: $60 (vs. current $46.51)

• Potential Upside: 29%

The timing of this upgrade aligns with On Holding AG’s recent acceleration in revenue and margin expansion, as well as improved sentiment following its inclusion in other top analyst lists (e.g., Zacks #1 Rank). Citigroup’s consumer team, with deep sectoral expertise, is signaling that On’s growth is not just a pandemic-era phenomenon but is now underpinned by operational leverage, international expansion, and brand resonance among younger consumers.

Analyst Confidence and Sector Context

The consumer discretionary sector has been volatile in 2025, with global supply chain normalization and shifting consumer preferences. Citigroup’s upgrade places On Holding AG alongside other high-momentum consumer names, reflecting confidence in management’s execution and the brand’s capacity to gain share—even amid macroeconomic headwinds.

Financial and Stock Performance: Momentum Meets Fundamentals

Financial Highlights

On Holding AG’s most recent financials point to a company firing on all cylinders:

• Revenue: Accelerating YoY, driven by both DTC (direct-to-consumer) and wholesale channels.

• Profitability: Margins are expanding as scale benefits kick in; cost structure remains tight despite inflationary pressures.

• Cash Flow: Strong operating cash flow, with ample liquidity to fund international growth and product innovation.

Stock Price Dynamics

Over the past year, ONON shares have traded between a low of $29.84 (May 2024) and a high of $64.05 (January 2025)—a testament to both volatility and investor enthusiasm. The current price of $46.51 is up approximately 3% in early trading today, likely in response to the Citigroup upgrade and other bullish analyst actions.

Technicals and Sentiment:

• RSI (Relative Strength Index): 64, indicating bullish momentum but not yet overbought.

• Bollinger Bands: Price is near the upper band, with volatility averaging 1.93% daily—a sign of strong market interest.

• Volume: Average daily volume is robust at ~4.7 million, with a spike on key news days.

Notably, the sentiment ratio (up days vs. down days) is slightly below 0.5, suggesting that while volatility persists, upside catalysts are beginning to outweigh recent drawdowns.

Sector Tailwinds, Risks, and Recent News

Macro & Competitive Landscape

On Holding is benefiting from strong secular trends—health and wellness, premiumization, and the rise of athleisure. However, the sector is not without risk. Recent macro headlines, such as the US-China trade war, have created headwinds for global brands. While On is Swiss-based, its exposure to international supply chains and Chinese consumers is significant.

"Some big US consumer companies like Nike (NKE) and Starbucks (SBUX) have a significant presence in China too. TD Cowen managing director John Kernan performed a survey on how the trade tensions are impacting US brands in China." — Yahoo Finance, Apr 26, 2025

This macro uncertainty has been a drag on consumer discretionary stocks broadly, but On’s recent addition to Zacks’ #1 (Strong Buy) list and its continued sales momentum suggest resilience.

Recent Newsflow

• Zacks Strong Buy (Apr 25): Reinforces bullish analyst consensus and adds institutional credibility.

• Sector Headlines: Ongoing trade tensions create both risk and opportunity—brands with authentic global appeal may gain market share as supply chains shift.

• Insider Activity: No major insider selling reported; institutional accumulation remains steady.

Potential Upside: What a 29% Return Means for Investors

A 29% potential upside—Citigroup’s implied target from $46.51 to $60—places On Holding AG among the most compelling medium-term trades in the consumer space. Such upside is not just theoretical; it’s underpinned by:

• A brand with viral cultural momentum (athlete endorsements, fashion collaborations)

• Operational discipline, with expanding margins

• Resilient international demand

• Bullish institutional sentiment and technical momentum

What Could Go Wrong?

Risks include:

• Macro shocks: Escalation of trade tensions or global slowdown

• Execution: Overextension as On expands into new categories

• Valuation: Premium multiples expose the stock to sharp corrections on any miss

However, Citigroup’s move suggests these risks are more than priced in at current levels, especially with operational outperformance.

Conclusion: Citigroup’s Upgrade as a Catalyst for Broader Re-Rating

For sophisticated investors, Citigroup’s Buy rating and $60 price target on On Holding AG is more than a signal—it’s a call to re-examine assumptions about growth, margin scalability, and brand resonance in the sportswear sector. With technicals, fundamentals, and analyst sentiment aligned, the stage is set for further gains—provided the company continues to deliver against its ambitious international and product roadmap.

In summary:

• Citigroup’s upgrade carries significant weight due to its sector expertise and global reach.

• The 29% potential upside is supported by both recent financial performance and technical indicators.

• Macro risks remain, but On’s execution and analyst conviction make it a name to watch—and potentially own—at the current inflection point.