Key Takeaways
The recent flurry of insider buying at On Holding (ONON) has caught the attention of the market, with key executives making substantial open-market purchases. On May 14, 2026, three of On's most senior leaders – Executive Officer Bernhard Olivier, and Co-CEOs Caspar Felix Coppetti and David Michael Allemann – each acquired approximately 60,000 Class A shares. These purchases, valued at roughly $2.2 million per executive, represent a significant vote of confidence in the company's trajectory.
This cluster buying stands out, especially when viewed against the broader insider activity. In Q2 2026, On Holding saw a net acquisition of 180,000 shares by insiders, compared to just 16,600 shares disposed, resulting in a robust 1.50 buy/sell ratio. Such concentrated buying from multiple top-tier executives, particularly the co-founders now leading as Co-CEOs, often signals that those closest to the company believe its shares are undervalued or that significant positive developments are on the horizon.
It's important to differentiate these purchases from other insider transactions. While former CEO Martin Hoffmann did sell shares in the preceding months, these sales were executed under a pre-arranged Rule 10b5-1 trading plan. Such plans are typically set up in advance to diversify holdings or manage liquidity, and they generally carry less informational weight regarding management's immediate view of the company's prospects. In contrast, the recent open-market purchases by the co-founders reflect a direct, discretionary decision to increase their equity exposure, underscoring their belief in On's strategic direction and future performance.
On Holding recently announced a significant organizational restructuring, effective May 1, 2026, which saw co-founders David Allemann and Caspar Coppetti assume the roles of Co-CEOs. This move is designed to more closely align the founders' long-term strategic vision with the company's operational execution, aiming for increased agility and decisiveness as On enters its next phase of global expansion. The company explicitly stated its goal to "move faster, stay relentlessly focused on product heat, and continue pushing the boundaries of what a sportswear brand can be."
This leadership shift follows a "record-breaking 2025," where annual net sales surpassed CHF 3 billion and gross profit margins reached new heights. The co-founders, alongside former CEO Martin Hoffmann and the Board, developed a strategic roadmap for this continued growth. To navigate the complexities of scaling globally while preserving its entrepreneurial speed, On opted for a unified leadership structure. Olivier Bernhard, another co-founder, remains an Executive Member of the Board, focusing on key performance product initiatives and athlete engagement.
Further bolstering the operational core, Scott Maguire has been promoted to President & COO, overseeing the entire value chain from R&D to global commercial operations. Maguire, known for his expertise in engineering and design, has been instrumental in scaling On's innovative technologies like LightSpray™. This comprehensive leadership team aims to ensure that On's strategic intent, innovation, product development, brand building, and commercial execution are seamlessly connected, fostering a "connected flywheel" approach to growth.
On Holding's stock has experienced a significant pullback this year, with shares currently trading at $36.91, a stark contrast to its 52-week high of $61.29. This decline, representing a year-to-date share price return of down 24.62% and a 1-year total shareholder return of down 38.55%, has led many investors to question whether the stock now presents an attractive entry point. Despite the recent weakness, several valuation models suggest that ONON could indeed be undervalued relative to its intrinsic worth.
A Discounted Cash Flow (DCF) analysis, which projects future cash flows and discounts them back to today, indicates that On Holding might be undervalued by approximately 10.8%. One model estimates a fair value of $40.62 per share, compared to the current price of $36.91. Another narrative suggests an even higher fair value of $56.41, implying a 37.3% undervaluation. These models often factor in the company's strong growth trajectory, including the acceleration in Direct-to-Consumer (DTC) and e-commerce channels, which reached 41.1% of sales in Q2 and grew 54% year-over-year. The shift to DTC enhances control over brand, pricing, and customer data, leading to improved gross and EBITDA margins.
However, the valuation picture isn't entirely straightforward. While DCF models point to undervaluation, the company's P/E ratio tells a different story. On Holding trades at a P/E of 36.6x, which is notably higher than the estimated fair ratio of 28.2x, the US Luxury industry average of 20.9x, and its peers at 22.9x. This premium suggests that the market is still pricing in significant future growth, and any slowdown could introduce valuation risk. Investors should carefully consider these mixed signals, perhaps stress-testing their own scenarios, before making a decision.
On Holding's growth story is underpinned by several powerful drivers, positioning it for continued expansion in the competitive sportswear market. The company's relentless focus on innovation, particularly its proprietary CloudTec® and LightSpray™ technologies, continues to attract a rapidly growing global fanbase. This commitment to performance-enhancing products ensures a steady pipeline of "product heat," a critical factor in maintaining brand relevance and premium pricing power. The promotion of Olivier Bernhard to focus on product initiatives and Scott Maguire to oversee R&D as President & COO further solidifies this innovation-driven strategy.
The strategic shift to a Co-CEO model, bringing co-founders David Allemann and Caspar Coppetti into direct operational leadership, is another significant catalyst. This move is designed to accelerate decision-making and ensure that the entrepreneurial spirit that defined On since its inception remains intact, even as the company scales globally. Their stated goal of unifying "founder-led strategic intent with our operational core" is a clear signal of intent to execute rapidly on expansion plans.
Furthermore, On's expanding global presence, now reaching over 90 countries, coupled with its robust digital community on www.on.com, provides ample runway for market penetration. The continued growth of its Direct-to-Consumer (DTC) channel, which not only boosts sales but also improves margins and customer data insights, is a key operational lever. As DTC sales continue to increase as a percentage of total revenue, On is expected to enhance profitability and strengthen its brand connection with consumers, driving long-term shareholder value.
While On Holding presents an compelling growth narrative, investors must carefully weigh several potential risks. The company's premium valuation, particularly its P/E ratio of 36.6x compared to industry averages, means that a significant portion of its future growth is already priced into the stock. Any deceleration in revenue growth, unexpected margin compression, or failure to meet ambitious expansion targets could lead to a sharp re-evaluation by the market. The stock's current price of $36.91 is still trading at a premium to some fair value estimates, highlighting this sensitivity to future performance.
Another critical risk lies in the highly competitive nature of the global sportswear market. On Holding operates alongside established giants like Nike, Adidas, and Lululemon, all with vast resources, brand recognition, and distribution networks. While On has successfully carved out a niche with its innovative products, maintaining its rapid growth trajectory and market share against such formidable competitors will require sustained innovation and effective marketing. Any misstep in product development or brand positioning could quickly erode its competitive edge.
Finally, the recent leadership transition, while framed as a positive move to unify strategic intent, introduces an element of execution risk. While the co-founders are deeply familiar with the brand, transitioning to a Co-CEO model and integrating a new CFO (Frank Sluis) requires seamless coordination and effective delegation. Any internal friction or disruption during this transition period could impact operational efficiency and strategic execution. Investors should monitor upcoming earnings reports and management commentary for signs of smooth integration and continued strong performance.
On Holding is navigating a pivotal moment, with its co-founders stepping up to lead as Co-CEOs and a clear strategy for accelerated global expansion. The recent cluster of insider buying by these very leaders underscores a deep conviction in the company's future, despite the stock's recent pullback. While valuation remains a point of debate, the underlying fundamentals of innovation, strong brand appeal, and a growing DTC channel paint a compelling picture. For investors with a long-term horizon, On Holding's strategic moves and insider confidence could signal a promising opportunity, provided they are comfortable with the inherent risks of a high-growth, premium brand in a competitive market.
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