Adidas holds a 19% potential for growth.
Following an upward trend, Adidas shares have entered a stable period. Investors can still earn high returns if this status quo continues by using certificates with a predetermined cap.
In January 2024, the Adidas share price spiked to €165. Positive analyst remarks ahead of new release details led to a rise in share prices because of sales growth in China and Latin America despite reduced sales in North America. The stock price even reached over €230 in mid-May, before a profit-taking correction brought it down to €221.80.
Thanks to the strong prospects and moderate forecasts for the current year, analysts maintain their buy recommendations for Adidas shares with potential prices reaching €276 (UBS).
The Investment Approach
Bonus certificates with a cap provide great yield potential and a safety feature for investors who suspect that Adidas shares will remain relatively stable after their recent remarkable increase. These certificates can generate double-digit percentage returns over the next few months.
In contrast to acquiring shares directly, bonus certificates with a cap hold a distinct benefit: they enable investors to gain substantial returns even if share prices don't move, or even fall. In exchange for these attractive sideways options, certificate holders forfeit the unrestricted potential of share investment and the possibility of dividend earnings.
Working Mechanism
If the Adidas share doesn't reach or drops below the €167.50 mark by the certificate's expiration date, the bonus certificate with cap will be redeemed on June 27, 2025, at the bonus level of €275.
The Highlights
The DZ Bank bonus certificate with cap on Adidas shares (ISIN: DE000DQ3T3D8) features a €275 bonus level and a cap. The cap stipulates the certificate's maximum payout amount. The barrier valid until the expiration date, June 20, 2025, is set at €167.50. At the current Adidas share price of €221.80, investors can purchase the certificate for €231.66.
The Opportunities
Given the current certificate price of €231.66, it offers a net yield of 18.71% (or 17% annually) over the next 13 months if the Adidas share price never decreases by 24.48% to €167.50 or below by the expiration date.
The Risks
If the Adidas share touches the barrier at €167.50 by the expiration date and the share price is quoted below the cap on the expiration date, the certificate will be redeemed based on the Adidas share's closing price determined on the expiration date. If this is below €231.66, the certificate investment will result in a loss.
This article does not urge you to purchase or sell Adidas shares or investment products linked to Adidas shares. We disclaim any liability for data accuracy.
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- To increase their potential returns, some investors may consider investing in securities like bonus certificates with a cap on Adidas, as these offer a yield potential and a safety feature during periods of stable share prices.
- As part of their investment strategy, some financial advisors may recommend purchasing bonus certificates with a cap on Adidas shares, as they can generate double-digit percentage returns even if the stock does not significantly increase or decrease in value.
- In addition to Adidas shares, some investors may also consider investing in other assets, such as stocks that are part of indices like DAX, as these can offer diversification benefits and potential for growth.
- With the help of a financial advisor, consumers can evaluate their risk tolerance and investment objectives to determine which financial instruments, such as Adidas shares or bonus certificates with a cap, align best with their investment goals.
Source: www.ntv.de
