Puma Earnings: Strong Results in Europe but Other Regions Remain Works in Progress

No-moat Puma’s second-quarter results were in line with our expectations as 20% sales growth in Europe, the Middle East, and Africa more than offset an 8% sales decline in the Americas. Moreover, the firm reaffirmed its full-year guidance of high-single-digit percentage currency-neutral sales growth and an operating margin of EUR 590 million-EUR 670 million. We may lift our respective 6% and EUR 621 million estimates to account for the brand’s solid momentum in Europe and upcoming product releases (including its Fenty collaboration) but would look for a more attractive entry point given that shares trade above our EUR 49 fair value estimate (which we may revisit).