Adidas AG’s tearing stock rally had left analyst targets in the dust. A falling out with rapper Ye is bringing it back to the ground.

After a 71 percent surge, the stock slumped as much as 11 percent Friday, the biggest decline in more than two years. Adidas had recently risen above its average analyst price target prior to Thursday’s update, with apparel stocks among the biggest beneficiaries of the easing in interest-rate expectations amid signs of cooling inflation worldwide.

Adidas warned yesterday of a potential operating loss of as much as €700 million ($752 million) this year, as it ends its lucrative line with Ye, the artist known for hits like ‘Gold Digger’  and ‘Stronger,’ following antisemitic and racist remarks. The Bavaria, Germany-based company said the worst-case scenario is if it has to write off all existing Yeezy inventory.

Volker Bosse, an analyst at Baader Helvea called the outlook “horrible” in a note to clients, keeping a reduce rating on the shares. Jefferies, meanwhile, cut the stock to hold from buy.

The shares were down 11 percent to €139.5 as of 10:00 a.m. in Frankfurt. The average price target among 36 analysts surveyed is €139.4, according to data compiled by Bloomberg.

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Inside Adidas’ Yeezy Dilemma

The German sportswear giant’s partnership with Ye generated $1.7 billion in 2021, accounting for nearly 7 percent of its annual revenue. Now that the company has cut ties with the rapper, will it keep selling Yeezy designs?