Freedom Broker: Adidas’ record profit supports the stock outlook

Growth in direct sales and improved profitability support the investment appeal of Adidas AG (Xetra: ADS), according to Freedom Broker analysts. The arguments in favor of the German sporting-goods maker’s shares are presented in the investment review “Change of Leader”. They include record quarterly results and an improved full-year outlook for the company.

Adidas produces sports and casual footwear, apparel, and accessories. The company sells its products through wholesale partners, its own stores, and online platforms.

Operating profit exceeded €1bn in a quarter for the first time

According to Adidas’ report, revenue for Q3 2026 increased 9% year over year to €7.25bn. Operating profit rose 37% to €1.01bn, and the operating margin improved from 11.1% to 13.9%.

An important source of growth was apparel sales, which, excluding currency fluctuations, increased 19%. Direct-to-consumer sales grew 17%, including an 18% increase in online sales and 16% growth in sales at company-owned stores.

Upgraded guidance supports a positive view

Management raised its 2026 operating profit forecast from €2.3bn to about €2.5bn. Revenue excluding currency fluctuations is expected to increase by 9–10%.

At the same time, part of the improvement in results was driven by the refund of U.S. tariffs of about €200m. This factor should be taken into account when assessing the sustainability of profitability. Challenges persist in Europe: the region’s sales excluding currency fluctuations fell 4% amid cautious shipments to wholesale partners and high activity of discount offerings in the market.

Most investment banks recommend buying the stock

According to Freedom Broker’s review, of the 35 investment banks covering Adidas, 29 recommend buying the shares, five recommend holding, and one recommends selling. The average target price is €201.55.

In the technical section of the review, analysts note an upward channel formed in October. After breaking above the €172 level, they allow for a move in the price toward €183. This is a short-term technical reference point that differs from the average target price of the investment banks.

Previously, Freedom Broker had already reviewed Adidas’ prospects, highlighting profit growth and a marketing campaign for the 2026 FIFA World Cup. The new quarterly results added to the arguments in favor of the company.

Not an individual investment recommendation.