Anjos, FernandoTerrasson, Chloé Marie2025-08-292025-08-292025-01-13http://hdl.handle.net/10362/187147This thesis explores a fundamental pairs trade strategy of adidas and PUMA. Adidas’ volatile unlevered free cash flows, caused by inefficiencies and higher leverage, contrast with PUMA’s stable growth, cost efficiency, and conservative capital structure. Forecasts highlight PUMA’s focus on Emerging Markets and adidas’ reliance on mature markets, providing key insights for the investment proposition. The valuation emphasizes PUMA’s undervaluation and growth potential versus adidas’ overvaluation and higher risk. The long PUMA, short adidas strategy proves robust, offering investors a promising opportunity for risk reduction and relative returns.engFundamental pairs tradeAdidasPUMAFinancial analysisProfitabilityCash flow managementCapital structureIncome statementBalance sheetCompany valuationDiscounted cash flowScenario analysisRisk managementInvestment propositionmaster thesis203991397