UPDATE: In a shocking move, Bank of America has issued a rare double-downgrade on Adidas, slapping a “sell” rating on the stock as the long-running trend of casual fashion appears to be reaching its end. This urgent news comes at a time when the industry is buzzing with optimism, making BofA’s contrarian stance all the more significant.
According to the bank’s latest research, the two-decade “casualization” of fashion is drawing to a close. Bank of America reported that sneakers surged from 20% of the footwear market to a staggering 50% over this period, but analysts believe we are now at the peak. As society embraces ever more relaxed attire—from pajamas at airports to sneakers paired with suits—BofA warns that Adidas will face declining organic sales growth, slipping into single digits.
On Tuesday, Adidas shares plummeted as much as 7% following the downgrade, further compounding the company’s woes after a 29% decline in 2025. While other analysts remain bullish on Adidas, BofA’s bearish outlook marks a significant shift in sentiment within the market.
As competitors like Nike and brands such as Asics and On continue to thrive, Adidas risks losing market share as consumers pivot from casual wear back to sporting goods. Nike recently benefited from strong North American growth, driving a sales increase that could further threaten Adidas’ position.
Despite the looming 2026 World Cup, where Adidas’ ambassador Lionel Messi will be a key figure, BofA remains skeptical about any impending sales surge. They caution that once the excitement of the tournament fades, Adidas will still grapple with the same underlying issues that have plagued its brand.
This developing situation emphasizes the urgency for Adidas to revamp its strategy or risk fading into the background of a highly competitive market. As analysts watch closely, the outcome for Adidas may hinge on its ability to adapt to a shifting landscape. The company’s impending challenges could spell the end of the sneakers-with-suits trend, a small silver lining amid this tumultuous forecast.
The implications of this downgrade are significant not just for Adidas but for the broader fashion industry. Investors, consumers, and fashion enthusiasts alike should stay tuned for the latest developments as the situation unfolds.
