Report project about 4 pages

Adidas project

Mohammed A Duhaiqi

Margaret B. Takeda

California State University of San Bernardino

Management 405

June 9 , 2020

FINAL PROJECT QUESTIONS

THIRD SET

CFRA EQUITY RESEARCH COMPANY REPORT

Q1. What is the “Recommendation” for this company’s stock? How many Stars are

highlighted?(at the very report) What do those stars mean? (at the very bottom of the

report)

The recommendation is to hold, expansion of the overly-aggression of the retail operation and

expanding the geopolitical crisis in these regions. 3 STARS are highlighted and the STARS

mean the qualitative recommendations determined and assigned by the equity analysts. In reports

containing stars, recommendations relate to the glossary section of the report for detailed

methodology and definition of STARS rankings.

Q2. What is the Analysts’ Risk assessment LEVEL for the company? Name the level then

copy and paste the brief explanation.

The risk assessment level is Medium. Our risk assessment balances the slower economic growth

in Europe, with defensive features in the group's outsourced production (low fix cost base) as

well as greater potential than peers for cost-cutting in opex.

Q3. Please provide the details of ONE”Highlights” item listed

The Adidas constant exchange rate

Revenues declined by 19% at brand Adidas and 12% at Reebok brand. In Asia Pacific, revenues

declined at 45% leading to the closure of stores in Japan, China, and South Korea. Some

countries like Russia and North America were spared.

Q4. What is the corporate strategy as outlined in the business summary?

Adidas is inspiring and enabling people to realize the benefits and power in sports through the

following: Developing a foundation in teams in sports, innovations and creativity in sports

investments in the global sports brands, through creating flexible distribution channels and

focusing on long-term and sustainable shareholder values. The corporate strategy is to ensure

that people enjoy the love for sports.

Q5 Summarize the industry outlook- choose 3 distinct points and summarize them here

The Automobiles and components industry

This is the largest car making industry in the world producing cars like Volkswagen and BMW.

It also makes tires like Continental and Michelin. The car industry is highly sensitive to

economic growth and consumer satisfaction in general. The industry responds to the changes in

the environment that affect the growth of the economy.

The Consumer Durables and Apparel industry.

This consists of luxury goods and the homebuilding industry. Luxury goods include designers,

retailers, and manufacturers of the end products. Companies in the homebuilding industry ensure

that there are residential accommodation units that are affordable by lowering mortgage rates.

The Consumer Services industry

This includes hotels, restaurants, leisure services, and other accommodation centers. The

consumer service industry offers clients the end service that will generally satisfy the user after

use.

Your research on COVID and your company and industry

Q1. Find 2 articles related to the current global pandemic and its impact on your

Company. Copy the URLs and place them here.

The CNBC article ‘Adidas says first-quarter profits fell more than 90% due to coronavirus stores

closure’ by Elliot Smith and Matthew J. Belvedere. This article helps in determining the financial

position of the Adidas group more so in this COVID-19 pandemic. The article highlights that the

company’s revenue has decreased by 90% proportion. https://www.cnbc.com/2020/04/27/adidas-

q1-2020-earnings.html

The Inside games article ‘Adidas earnings hit hard by coronavirus pandemic’ by Michael

Houston on 30 April 2020. This article helps to determine the success measures of the Adidas

group and

whether the company will continue surviving in the current global pandemic.

https://www.insidethegames.biz/articles/1093763/adidas-covid-19-profits-quarter

Q2. Find 2 articles on the current global pandemic and its impact on your Industry. Copy

the URLs and place them here.

The pharmaceutical journal article ‘Everything you should know about the Coronavirus

outbreak’ by Kristoffer Stewart, Dawn Connelly, and Julia Robinson in May 2020. This article

helps the Adidas group to understand the measures to observe to prevent the spread of the global

pandemic. https://www.pharmaceutical-journal.com/news-and-analysis/features/everything-you-

should-know-about-the-coronavirus-outbreak/20207629.article?firstPass=false

The World Health Organization article on Coronavirus, This article provides a report on COVID

and suggests that Adidas should trade online to avoid contact with its customers to prevent the

spread of the disease. https://www.who.int/health-topics/coronavirus#tab=tab_1

Extra credit

April 28, 2020

No, i have found only one report

References

https://www.cnbc.com/2020/04/27/adidas-q1-2020-earnings.html

https://www.insidethegames.biz/articles/1093763/adidas-covid-19-profits-quarter

https://www.pharmaceutical-journal.com/news-and-analysis/features/everything-you-should-

know-about-the-coronavirus-outbreak/20207629.article?firstPass=false

.