adidas Stock Analysis (FY 2020)

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adidas is a global powerhouse when it comes to sports apparel. The company has built an impressive brand and is recognised by customers everywhere. Many of the worlds most renowned stars in sports are proudly wearing the brand with the three stripes. It is fair to say, that adidas and its biggest competitor (Nike) have established a duopoly in the sector with high entry barriers. In March 2021, adidas has opened its books for the past year, which – without a doubt – was a special one. Find out below how adidas has performed during the pandemic, with more than 70 % of global stores closed and being forced into lockdown. How did adidas cope with basically losing all revenue from its shop sales from one day to the next? Read more in our adidas stock analysis below.
Adidas_Analysis
adidas | Europe | Sportswear | Fiscal Year 2020 | ISIN: DE000A1EWWW0

Table of Contents

Qualitative Analysis

adidas Company History

In the early 1920’s the two brothers, Rudolf and Adolf Dassler, began producing custom made football shoes for professional athletes. However, there was a growing rivalry among the brothers which evenutally led them to part ways. Following their parting, Adolf Dassler founded adidas in 1949. His brother meanwhile went on and started another world brand – called Puma – in 1948. The name adidas is a ‘combination” of Adolf Dassler’s nickname (“Adi”) and the first three letters of his family name. Adidas gained global awareness in 1954, when the German national football team – wearing adidas football shoes – became world champion. To that point, the company did mostly focus on the production of football shoes.
Following Germany’s triumph in 1954, adidas started to extent its business by producing sports apparell, such as jerseys, shorts and sneakers. Until today, the company has not only built a strong brand but also many iconic products, some of which are still on sale today. For instance, the famous “adilette” which was released back in 1972 is still available today. In fact, sales of the adilette were up by +200 % during the pandemic. Other examples are the famous “Stan Smith” sneakers, or the “Superstar”, a shoe designed for professional basketball players.
Adolf Dassler died in 1978. At that point in time, adidas has already became a global brand and the worldmarket leader in its industry. From 1985, his son Horst Dassler took over the role as head of the company and further expanded the business into the lifestyle and fashion sector. However, the company was facing some serious financial issues in the mid 1980’s. Additionally, Horst Dassler died unexpectedly in 1987.
Due to the financial turmoil, external investors got access to the company. In the course of the following years, there were major changes in the company’s ownership structure. Eventually a majority shareholding in the company was held by French private and institutional investors. In 1995, adidas went public and listed on the German MDAX. Since 1998, adidas is a constant member of Germany’s prime index – the DAX.
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adidas Business Model and Outlook

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adidas SWOT Analysis

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adidas CEO: Kasper Rorsted

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Quantitative Analysis

adidas roovestor company score

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Disclaimer
We assume no liability for the accuracy of the financial data. Sources of the financial data are foremost IR websites of the company subject to the analysis. Additionally we rely on further data and information from Thomson Reuters EIKON. Moreover, unless better data is available, we do our own calculations of available data for KPI determination. Our stock analyses are by no means to be understood as a buy or sell recommendation and do not provide any conclusions regarding the future development of the company (and thus the future price development of the share).