On Holding just reported Q3 2026 numbers with record quarterly sales of CHF 931.4m and an underlying gross margin of 66.9%. Yet the stock closed down 7.5% on the day to US$34.73. That gap between a slipping share price and robust profit quality highlights a disconnect between sentiment and reported results.
Investors came in after a flat month and a solid 90-day gain, then watched a single session reset confidence. The strongest feature in this report is margin performance, and the market’s reaction appears more emotional than mathematical.
Love On Holding’s rich 66.9% gross margin but uneasy about how fast sentiment swung after this earnings print? Check out the list of solid balance sheet and fundamentals stocks (24 results).
Q3 2026 Earnings Summary
- Revenue (Q3 2026 vs. Q3 2025): CHF 931.4m vs. CHF 794.4m (up about 17%)
- Net Income, excl. extra items (Q3 2026 vs. Q3 2025): CHF 162.8m vs. CHF 118.9m (up about 37%)
- Basic EPS (Q3 2026 vs. Q3 2025): CHF 0.487 vs. CHF 0.360 (higher earnings per share)
- Underlying Gross Margin (Q3 2026): 66.9% (record level for On Holding in this quarter)
Earnings tell you what happened on the income statement, but investors who care about what they are paying for NYSE:ONON often focus on the cash moving through the business.
Looking at On Holding's cash flows and how they are projected into the future, the stock could be a dramatic 37% undervalued.
On Holding’s Premium Playbook Clears Early Hurdles
The bullish analyst narrative on Simply Wall St assumes On Holding can keep its full price formula intact while leaning harder into DTC and apparel.
"The main thing that has to go right is that On Holding maintains full price discipline in a promotional market while continuing to shift more sales into higher margin DTC and apparel without relying on discounting."
Q3 execution lines up cleanly with that ambition. Underlying gross margin reached 66.9% while DTC grew faster than wholesale and rose to 42.2% of sales. Apparel and accessories reached more than 9% of revenue, with management reiterating higher margin targets into FY26.
One Narrative has put a figure on that disagreement. → See the Narrative with its higher Fair Value, assumptions and all.
Bearish Premium Fears Meet Record On Holding Margins
The bearish analyst narrative on Simply Wall St argues that full price discipline in a promotional world eventually cracks.
"Dependence on disciplined full price execution leaves On Holding exposed if the highly promotional environment in the Americas persists. Any shift toward clearing stock through markdowns would undermine the premium model and weigh on both gross margin and net margins."
On Holding reported a record 66.9% underlying gross margin and a roughly 21.9% adjusted EBITDA margin, while Americas revenue still grew and DTC mix climbed to 42.2%. Inventories rose to CHF 495.7m, though, so the risk has not vanished. It has just not shown up in the P&L this quarter.
Hunt For Disconnected Fundamentals
On Holding reports strong numbers beside a sharp single day share price drop. The real opportunity is finding stocks that could be undervalued before the market corrects them.
- Company 1 - 40% below our estimate - redirects cash from a legacy label into higher margin outdoor wear, shareholder payouts, and balance sheet repair.
- Company 2 - 45% below our estimate - expands in house film production and direct distribution so large auto programs can lock in supply and installation support.
- Company 3 - 47% below our estimate - pours heavy spending into AI driven ad tools and hardware so marketers and consumers get more personalized digital experiences.
Three companies from the same screener. Open every one of the 37 undervalued companies on it →
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