What the market is pricing
Wide range: intrinsic value is highly sensitive to assumptions — use the scenario analysis to anchor your view.
Valuation range
Red = below today's price. Green = above.
ONON fair value — three scenarios
At today's price of $35.65, start with the base case.
Downside — if growth disappoints
Use this if growth slows, margins stay weak, or investors demand more return.
Most likely outcome
Start here unless you have a strong reason to disagree with the base case.
Upside — if execution beats expectations
Use this if the company grows faster or earns more than the base case assumes.
DCF key assumptions
These three inputs drive most of the intrinsic value estimate. If your view of the business differs on any of them, adjust the scenario above — the fair value will shift accordingly.
Revenue growth forecast
Fades to 6.4% in years 6-10
The model already fades growth below reported 5Y CAGR.
Operating margin forecast
Current operating margin (TTM): 12.5%
The model holds margins near the current run-rate — no heroic profitability improvement required.
WACC (required return)
Terminal growth 2.8% | Spread 8.2 pts
The 8.2 pts spread between WACC and terminal growth gives the model more stability against assumption changes.
All DCF inputs
High-impact inputs are the ones most likely to change the intrinsic value estimate if you disagree.
Revenue growth (years 1-5)
Average annual revenue growth assumed across the first five forecast years.
Revenue growth (years 6-10)
Growth gradually fades toward a long-run sustainable rate in the second forecast decade.
Operating margin (year 1 → year 10)
Profitability path used to convert revenue into free cash flow across the forecast period.
CapEx & reinvestment
How much of operating profit is spent on CapEx and working capital instead of being distributed as free cash flow.
WACC — weighted average cost of capital
Built from beta 1.40, risk-free rate, and equity risk premium plus a size premium. A higher WACC compresses intrinsic value quickly.
Terminal growth rate
Perpetual growth rate applied after year 10 — sets the size of the terminal value that drives most of the DCF.
Free cash flows to the firm discounted at WACC (enterprise model). Forecast source: analyst estimates. If your view of the business differs on any of these inputs, the bear and bull scenarios above show how the fair value shifts.
Revenue growth — history vs. model forecast
Past revenue growth
46.6%
5-year avg.
3-year avg. 33.1%
-30.6 pts
vs forecast
DCF base-case forecast
16.0%
Avg years 1–5
Tapering to 6.4% in years 6–10
Model growth averages 16.0% versus 46.6% historically — the model is already more conservative than the reported track record.
Profitability today (TTM)
12.5%
Operating margin TTM
9.2%
FCF margin TTM
DCF model type
Analyst estimates
FCFF (Operating)
Cash flow measure: Operating margin
On Holding AG's DCF is more grounded in near-term cash flows than most — the first decade carries an above-average share of intrinsic value.
In the base case, 52% of intrinsic value comes from the 10-year forecast and 48% from the terminal value. The higher the terminal value share, the more the fair value depends on long-run growth assumptions rather than near-term execution.
Base-case value split
52%
Years 1-10
48%
After Year 10
Dark = Years 1-10. Amber = after Year 10.
Cash flow path
$512.3M → $1.1B
Year 1 to Year 10 base case
The base case asks for a meaningful ramp in free cash flow over the decade.
Use it as a range — lean on the scenario spread above and the sensitivity analysis further down the page.
How the score is calculated
Model limitations
Limited data coverage
-4 ptsSome inputs could not be fully verified from available sources, so the estimate carries a wider margin of uncertainty.
Model strengths
Sufficient operating history
✓ PassAt least five years of annual history feed the model, so the forecast is not starting from a thin base.
Analyst-backed revenue forecast
✓ PassRevenue and margin assumptions are based on analyst estimates, not just historical trends.
Near-term cash flows carry meaningful weight
✓ PassLess than 60% of the estimated value comes from beyond Year 10, so the near-term forecast carries real weight.
DCF sensitivity analysis
Small changes in WACC or terminal growth can shift the intrinsic value estimate significantly. This table tests whether On Holding AG still looks undervalued, fairly priced, or overvalued when those assumptions are adjusted up or down.
WACC × terminal growth
Each cell tests a different WACC and terminal growth combination. Top-left is the harshest. Bottom-right is the most forgiving.
| Terminal growth rate — lower is more conservative ← → higher is more optimistic | |||||
| WACC↑ higher = lower value↓ lower = higher value | 1.8% | 2.3% | 2.8%Base | 3.3% | 3.8% |
|---|---|---|---|---|---|
| 12.9% | -27%$26.19 | -25%$26.67 | -24%$27.20 | -22%$27.79 | -20%$28.44 |
| 11.9% | -19%$28.78 | -17%$29.41 | -16%$30.11 | -13%$30.90 | -11%$31.78 |
| 10.9%Base | -10%$31.93 | -8%$32.78 | Base-5%$33.73 | -2%$34.81 | ~0%$36.04 |
| 9.9% | ~0%$35.86 | +4%$37.03 | +8%$38.36 | +12%$39.89 | +17%$41.67 |
| 8.9% | +15%$40.88 | +19%$42.54 | +25%$44.47 | +31%$46.74 | +39%$49.46 |
What to do with this
Most tested scenarios still show On Holding AG trading above intrinsic value, but a few forgiving combinations bring it close to fair value. The key question: do you believe WACC should be lower, or terminal growth higher, than what the base case assumes?
Reverse DCF — what today's price implies
Reverse DCF keeps the cash-flow forecast fixed — including about 16.0% average revenue growth in Years 1–5 — then asks: what required return or long-run growth rate would make today's price rational?
Price vs. DCF fair value
above DCF fair value
What today's price is asking you to believe
Today's price sits close to the DCF base case overall.
The implied required return and long-run growth rate both sit close to the DCF base case, so the market is not making a meaningfully different bet on either lever.
Current price
$35.65Market price used in the reverse DCFDCF fair value
$33.73Base-case intrinsic value per shareForecast growth (Years 1-5)
16.0% avg. per yearAverage annual revenue growth in the DCF base caseWhat long-run growth does today's price imply?
vs. DCF base case
The implied long-run growth rate is close to the 2.8% assumption in the base case.
DCF base case terminal growth: 2.8%What WACC does today's price imply?
vs. DCF base case
The implied required return is close to the 10.9% used in the base case.
DCF base case WACC: 10.9%Same DCF model applied to every company. If ONON's gap to fair value stands apart from peers, the case is stock-specific — not a sector-wide trend.
| Company | Peer Type | Mkt Cap | Price | Intrinsic Value | Upside / Premium | Status |
|---|---|---|---|---|---|---|
| ONONOn Holding AGYou are here | Subject | — | $35.65 | $33.73 | -2% | Fair Value |
| Core | $52.9B | $44.41 | $23.57 | -47% | Overvalued | |
| Core | $14.9B | $133.59 | $161.40 | +21% | Undervalued | |
| Core | $14.6B | $102.70 | $124.43 | +23% | Undervalued | |
| Core | $7.2B | $39.05 | $54.92 | +42% | Undervalued | |
| Segment | $1.3B | $6.38 | — | — | — | |
| Segment | $5.2B | $104.08 | $192.93 | +86% | Undervalued | |
| Segment | $1.4B | $17.02 | $14.23 | -18% | Overvalued |
Differences in intrinsic value reflect differences in each company's financial data and business model — not inconsistency in the methodology. Peer rows without DCF coverage show “—”.
This page is for informational purposes only and does not constitute financial advice. Intrinsic value estimates are model outputs under stated assumptions and should not be relied upon as the sole basis for any investment decision.
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