25, 2023, to $36.40 today. 

The Finnish sports equipment giant is now trading at 6.5 times its IPO price, or 20.1 times its expected 2025 earnings per share of $1.81. Its earnings are expected to grow by 10.0% annually over the next five years, meaning the company is fairly valued at its current share price. 

While I don’t typically recommend vertical spreads on stocks that have such a high valuation, I do think that a bull call spread on Amer Sports could be a good bet. 

The Feb. 20 $42.50 call is out-of-the-money by 16.8%, with a breakeven price of $42.50 + $2.90 = $45.40. 

Investors can create a net debit position by buying the $42.50 call and selling the $45.00 call, limiting their risk to $2.90. The reward, if the stock closes above $45.40 on Feb. 20, is $2.60. 

With a profit probability of 40.4%, the risk/reward ratio is 1.12 to 1.

Amer Sports, the parent company of Salomon, Wilson, and others, saw a 11% drop in share price between May and September, but has since recovered most losses. Arc’teryx CEO aims for $5 billion in sales by 2030, boosting confidence. Valuation concerns persist as shares trade at 31.7 times the 2026 EPS estimate.

Despite valuation concerns, the sporting goods industry offers stable growth potential. A bull call spread strategy involving Amer stock shows promise with a maximum profit of $5.20 and a 43.1% profit probability. Amer reports Q4 2025 results on Feb. 24, potentially driving share price to new highs.

Overall, positive outlook on Amer Sports and its diverse business portfolio. Strategic buying of AS stock key to success. Bull call spread strategy presents profit opportunity, despite valuation concerns. Strong holiday report expected to boost share price post-Q4 earnings release.

Read more at Barchart: 2 Bull Calls, 1 Bull Put Income Play