12 Best New Stocks to Buy According to Hedge Funds

10) Amer Sports, Inc. (NYSE:AS)

Number of Hedge Fund Holders: 25

Amer Sports, Inc. (NYSE:AS) designs, manufactures, markets, distributes, and sells sports equipment, apparel, footwear, and accessories. The company’s stock began trading on the NYSE on 1^st February 2024.

Amer Sports, Inc. (NYSE:AS)’s growth trajectory is being supported by a potentially strong Chinese market and optimism around its Arc’teryx and Salomon brands. TD Cowen analyst, John Kernan, believes that Amer Sports, Inc. (NYSE:AS)’s $938 million share offering should help it in debt reduction, which, together with lower tax rates and refinancing, can enhance valuation multiples over the long term.

The growth in Arc’teryx and Salomon brands, mainly via direct-to-consumer channels, has been driving significant margin expansion, which is expected to continue. As per the analyst, Amer Sports, Inc. (NYSE:AS)’s operations in China should contribute significantly to incremental sales, with a projected sales CAGR of 25% over 3 years.  Amer Sports, Inc. (NYSE:AS)’s performance and premium positioning in outdoor categories and styles continue to gain traction in North America and China.

The overall outdoor apparel market in China continues to expand rapidly, with sales in the outdoor sports category soaring across various platforms. During the Double 11 shopping festival, sales increased by 70% year-over-year on platforms like Douyin, reflecting a strong consumer interest in outdoor gear. Therefore, Amer Sports, Inc. (NYSE:AS)’s focus on premium technical brands and direct-to-consumer strategies has placed it well to leverage China’s growing demand.