On Holding AG’s ONON premium store expansion is deepening consumer connections. Management says its stores help showcase footwear and apparel together, while its own channels give it control over the brand experience. Growth at existing locations and new openings reflects its selective approach to retail expansion.
In the second quarter of 2026, the Champs-Élysées flagship was On Holding’s strongest-performing store worldwide, with gains in traffic, conversion and average item values. Its Stockholm flagship performed at twice management’s expectations after two months. The company’s two Tokyo stores continued to perform exceptionally, with no signs of cannibalization.
Retail expansion contributed to direct-to-consumer (DTC) growth alongside e-commerce. DTC sales climbed 26% year over year to CHF 388.4 million or 34.3% at constant currency. The channel reached a second-quarter record 45.7% of sales, up from 41.1% a year earlier. The company cited higher traffic and transactions at existing stores and network expansion across all regions.
On Holding opened its first Macau store during the quarter. Management said it matched the momentum of its Hong Kong stores and achieved above-average conversion with the region’s widest assortment. Madrid and Milan stores also performed strongly. The company opened premium stores in the United Arab Emirates and its first stores in Copenhagen and São Paulo.
Management expects more store openings and DTC to strongly outperform wholesale in the second half. Quarterly capital spending was CHF 28.2 million, focused primarily on selective retail expansion and supporting infrastructure. Store-related personnel costs and depreciation increased as the footprint grew. On Holding’s growing DTC mix and stronger store performance support its premium growth strategy.
DECK & WWW’s DTC Picture vs. ONON
Deckers Outdoor Corporation DECK delivered strong DTC momentum in the first quarter of fiscal 2027, with total DTC sales increasing 13% year over year. The company’s DTC growth was led by HOKA, where global DTC revenues rose 17%, while UGG DTC increased 6%. DECK benefited from strong full-price demand, product innovation and disciplined inventory management, supporting higher gross margins. For fiscal 2027, Deckers expects to continue driving significant DTC growth, with management indicating no significant change in the channel’s trajectory. DECK views DTC as a key growth engine, supported by expanding international reach, new products and greater consumer engagement.
Wolverine World Wide WWW saw DTC revenues remain approximately flat year over year in the second quarter of 2026, despite 8% wholesale growth. WWW is making DTC a significant focus, with Saucony showing good DTC growth while Merrell is being repositioned toward a higher full-price mix and less promotional activity. Wolverine is investing in stronger online storytelling and more targeted marketing across the consumer funnel. Management acknowledged that more work remains but is taking steps to improve DTC performance, particularly ahead of the holiday season.
ONON’s Price Performance, Valuation & Estimates
On Holding shares have lost 15.4% over the past three months compared with the industry’s 11.8% decline.
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From a valuation standpoint, ONON trades at a trailing price-to-sales ratio of 2.23, above the industry’s average of 1.30. It has a Value Score of A.
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The Zacks Consensus Estimate for ONON’s fiscal 2026 earnings implies year-over-year growth of 77.3%, whereas the same for fiscal 2027 indicates an uptick of 16.1%. Estimates for fiscal 2026 have been revised downward by 1 cent, while those for fiscal 2027 have remained unchanged over the past 30 days.
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On Holding currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).