Puma Earnings: Prospects Look Slightly Brighter After In-Line Results; Shares Fairly Valued

No-moat Puma's first-quarter sales and profitability aligned with our estimates, which were updated after its comprehensive investor day in March. Although sales fell 4% in the quarter, the firm held to its full-year guidance for mid-single-digit percentage currency-neutral sales growth and EBIT of EUR 620 million-EUR 700 million. Moreover, management's commentary suggests that sportswear demand in key markets might be picking up slightly faster than we'd anticipated. As a result, we're lifting our 2024 expectations for sales growth to 3% from 2%, for EBIT to EUR 648 million from EUR 641 million, and for EPS to EUR 2.29 from EUR 2.19. After these changes, our fair value estimate rises to EUR 47.50 from EUR 46.50 but is below Puma's share price after a roughly 11% increase on the report.