
Puma stock climbs as Chinese sports company swoops in for big stake
China's Anta Sports paid a big premium but doesn't appear likely to launch bid for all of Puma.
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China's Anta Sports paid a big premium but doesn't appear likely to launch bid for all of Puma.

European equities climbed on Tuesday, supported by a raft of positive corporate updates that eased investors' concerns over recent trade tensions, while shares of Puma soared 19% after the sportswear maker sold a stake to China's Anta Sports.

Anta will pay 1.5 billion euros ($1.79 billion), or 25 euros per share, to take a 29.06% stake in Puma. The deal also came as Puma has struggled to revive sales after the new CEO Arthur Hoeld, a former Adidas executive, took the reins last year.

China's biggest sportswear brand Anta Sports Products said on Tuesday it would buy a 29.06% stake in Puma from the Pinault family for 1.5 billion euros ($1.8 billion), making it the biggest shareholder in the German sportswear maker.

Anta Sports has agreed to acquire a 29.06% stake in Puma for $1.79 billion, which will make the Chinese sportswear company its largest shareholder.

China's Anta Sports Products said on Tuesday it had agreed to buy a 29.06% stake in German sportswear maker Puma from the Pinault family's Artémis holding company for 1.51 billion euros ($1.79 billion).

China's Anta Sports Products has offered to buy 29% of struggling German sportswear firm Puma from France's Pinault family, three people with knowledge of the talks said.

ANTA Sports Products Limited (OTCMKTS:ANPDY - Get Free Report) was the recipient of a significant growth in short interest during the month of December. As of December 15th, there was short interest totaling 1,615 shares, a growth of 535.8% from the November 30th total of 254 shares. Based on an average daily trading volume, of

ANTA Sports Products Limited (OTCMKTS:ANPDY - Get Free Report) shares were up 0.6% on Friday. The stock traded as high as $275.05 and last traded at $273.83. Approximately 128 shares changed hands during trading, a decline of 89% from the average daily volume of 1,140 shares. The stock had previously closed at $272.13. ANTA

China's Anta Sports is among a number of firms looking to buy the German athletic brand, according to a media report.

ANTA Sports' strong performance is driven by its flagship Anta brand and the turnaround of Fila, showing resilience in China's consumption downgrade environment. The $290mn acquisition of Jack Wolfskin enhances ANTA's ex-China exposure and offers potential upselling opportunities in lower-tier Chinese cities. ANTA's value-for-money positioning and global expansion strategy, particularly into ASEAN and GCC, are key to its long-term growth amid a weak macro backdrop.

Anta's operational update for 2024 shows strong performance, with high single-digit revenue growth and promising online sales, positioning it better than competitor Li Ning. Anta is well-positioned for China's consumption downgrade, focusing on value-for-money sportswear, and has significant global expansion potential, particularly in Southeast Asia and the US. Valuation is attractive at 15.1x 2025E P/E with 11% topline growth and 17% net profit growth, justifying a premium over Li Ning due to stronger growth prospects.

I upgraded ANTA Sports stock to Buy due to strong Q4 2024 performance and increasing market share in China's sportswear sector. Impressive sales growth in Q4 2024, with ANTA brand up HSD and FILA brand turning around with MSD growth. Strong financials enable capital return and investment, including rapid share buybacks, potential M&A, and increased dividend payouts.

With a differentiated DTC-skewed model and diversified multi-brand portfolio, ANTA has consistently delivered robust FCFE generation, best-in-class margins, growth, and inventory turnover regardless of market cycles. It appears as an innocent victim of the tremendous China consumer selloff in the recent 3 years, when it is resiliently growing at mid-teens CAGR with a recent all-time-high net margin. ANTA looks very cheap compared to its peers and deserves a 58% upside, taking into account its top-notch competitive positioning and shareholder value generation capability.

Shares of China's leading sportswear maker initially jumped after it announced IPO plans for its Finland-based foreign unit, but later gave back the gains. Revenue for Anta's Amer unit jumped by nearly 30% in the first three quarters of last year, but its net loss also grew.

ANTA has outperformed its peers only in the Chinese market by emulating successful strategies and avoiding their pitfalls. Despite short-term inventory challenges due to the pandemic and DTC transformation, recovery signs are evident from ANTA's latest interim report. ANTA is the most likely Chinese sportswear company to capture a significant market share internationally but it does not have precedence of similar successful strategies to emulate from.

Global sportswear leaders are compounders with ROICs and I believe Anta can follow in their footsteps in the China market. The China sportswear industry is attractive to due to its huge growth runway, nationalism drive and supportive government policies. Short term, Anta multi brand strategy makes it well positioned for China's K-shape recovery.

ANTA Sports Products' stock has declined by 10.7% since April, but there are good reasons to believe it will rise over time. China's economy is showing signs of improvement, with retail sales and industrial production on the rise. The company has seen strong financial performance and its market multiples look improved too. Additionally, its healthy long-term returns and consistent dividend payouts go in its favour.

Growth stocks have been on a roll recently, and that's not really much news to anyone. However, what is new is that the recent inflation report is starting to show very promising signs.

ANTA Sports Products is a leading Chinese sportswear company with a strong presence in China. Revenue has grown at a CAGR of 22% in the last decade and the company boasts an EBITDA-M of 23%. Brand development, industry tailwinds, and the scope for international expansion represent key value drivers going forward.