Sell Amer Sports (AS) for Modest Gain
With tariff risks on the rise for many apparel and sportswear manufacturers, it’s not the most attractive space right now. A recent report from Morgan Stanley suggests potential for an 18% reduction in 2025 EPS from the “softlines” group due to a 10% tariff on China.
While there are a lot of company-specific factors that will help some companies and hurt others if these tariffs stick, the market sees the risks to the entire group as going up. We have a modest, single-digit gain on Amer Sports (AS) right now, and I don’t want to see that turn into a modest, single-digit loss (or worse) because I thought the stock would be one of the exceptions (even though AS only has around 11% sourcing exposure to China and is doing extremely well in the country).
Bottom line – we have a lot of stocks that are working, and we don’t need to muck around with those that have murky outlooks. Let’s step aside from AS until things clear up. SELL
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