Puma Has Made Strides in the Attractive Global Sportswear Market, but It Lacks a Competitive Edge

We view 75-year-old Puma as a leader in global activewear, but do not believe it has achieved a competitive moat. Since 2014, Puma’s annual sales have risen to more than EUR 8 billion from EUR 3 billion as it has expanded distribution, introduced new products, and stepped up its marketing. At 2.5%, the brand had the fourth-largest share (by sales) of the fragmented, but attractive, $372 billion sportswear market in 2022 (Euromonitor). However, wide-moat Nike and narrow-moat Adidas are the leaders by wide margins in most regions, and we do not expect Puma will gain significant share on either. Moreover, the company faces threats from fast-growing competitors like narrow-moat activewear firms Lululemon, Anta, and Li Ning.