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(Sharecast News) - Puma shot higher on Thursday after Citi upgraded the sportswear brand to 'buy' from 'neutral' and hiked the price target to 35 from 27.50.
The bank said new deep dive analysis highlighted the potential major mid-term growth opportunity in Greater China following the acquisition of Anta, and driving FY27e/28e sales up +6%/+13% above Visible Alpha consensus.
"We also see meaningful scope for GM expansion, forecasting +240bps/-50bps/+140bps in FY26/27/28e with channel mix, FX, regional mix and promo reduction driving tailwinds, which we believe will more than offset headwinds from sourcing/freight," Citi said.
"Our FY26e/27e GM forecast is +60bps/-60bps versus consensus."
Citi said it assumes a return to profitable growth in FY27, in line with management's guidance, and its EBIT is 12% higher than consensus.
"Our FY26e/27e earnings per share increases by 15/71% given more constructive China growth forecasts and better opex leverage," the bank said.
At 1317 BST, the shares were up 5.5% at 27.89.
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