$ONON Premium Sports Brand

Onon is a swedish footwear and clothing company. It is ran by two cofounders Mr. Alleman and Mr. Coppetti. The companies shoes have been on the feet of many of the Marathon winners. Their shoes are in the upper price range of the shoe category. While not extremely expensive, like some of the newer running shoes, they still command a premium price tag. They do not run sales on their shoes because they want to keep in the premium brand. I tried their Cloud Flyer shoe and while the shoe was light and comfortable I found that they did not give enough support for my pronation. I haven’t found an Onon shoe that supports people with pronation problems and when running with their shoes I had problems with my knees. But a lot of people do not have that problem and shoes are something that everyone has to try until they find the right ones. I am going to stick with New Balance 860’s.

Onon Shoes cost around $180 dollars and they are coming out with a new shoe that they just trialed called the cloudtilt which sold for $490 dollars. $490 for a daily run shoe is getting pricy unless you are a competitive runner. They have 3 key strategies for right now. 1. Be the most premium sportswear brand 2. increase premium multichannel distribution and store fronts to reach fans globablly. 3. Expand into China at a faster pace in order to reach more people. They aim to double their net sales by 2026 and reach a gross profit margin above 60 percent. At this time they are at a yearly run rate of 1.8 billion.

Onon has been growing very fast their growth came in at 46 percent last quarter. They bumped the end of year Revenue up slightly, they do not give quarterly revenue guides, but the street did not like it because even with the slight bump up they are guiding for 21.3 percent YoY revenue growth and -7.39 percent sequential growth. Onon is still a young brand and not everyone has heard of them so expect their Revenue to be on the lumpy side. Right now they are trading at the lower part of their P/S range with a P/S of 4.26, they are the new flavor of running shoe much like Hoka was a few years ago. The difference between Hoka and Onon is that Onon is a pure play while Hoka is part of the Decker shoe company. Here is a look at their financials.

Andy

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