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Here's Why Sneaker Stocks (UA, NKE, ADDYY) Are Gaining Today
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Shares of athletic apparel behemoth Nike (NKE - Free Report) gained more than 3.2% in morning trading Monday after a notable analyst upgrade; its industry competitors, Under Armour (UA - Free Report) and Adidas (ADDYY - Free Report) , were also up thanks to a newly-inked sponsorship deal and the continuation of positive momentum.
From Worst to Best?
Heading into the week, Nike was the worst performing component of the Dow, but apparently that hasn’t scared away everyone. The sneaker giant received an upgrade from HSBC to “buy” from “hold” on Monday, and the ratings firm also bumped its price target up to $60 per share from $50.
“The company epitomizes, in our view, the 'captain of industry' status in a growth sector, and even though we accept that alternative brands may be gaining share at times, we feel the company is still poised for superior growth and returns long term,” said HSBC in a note.
Under Armour Goes Yard
We can assume that one of the “alternative brands” that HSBC mentioned is Under Armour, an athletic apparel maker whose sneaker profile has skyrocketed thanks to its endorsement of two-time NBA MVP Steph Curry.
Under Armour’s brand was further legitimized on Monday as the company announced a 10-year deal to be the official on-field uniform provider of the MLB. The sponsorship doesn’t start until the 2020 season, but its importance for Under Armour can’t be understated; this is the first professional sports league deal for the Baltimore-based company.
Shifting Momentum for Adidas?
For Adidas, Monday’s trading activity seems to be coming from the overall strong start to the week for stocks, as well as a continuation of its recent momentum. The German athletic giant has struggled since its lackluster Q3 earnings report, but shares of started to turn things around over the last few days of trading.
Overall, the stock has lost about 3% over the past four weeks, but shares are up over 3.75% in the past week.
Bottom Line
Today is a day to celebrate for the world’s largest sneaker companies. Under Armour has inked a monumental deal that will help cement the legacy of its brand, while Nike and Adidas are showing signs of turning things around after some long-term and short-term difficulties. With the holiday quarter in full swing, things could get interesting in this sphere soon.
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Here's Why Sneaker Stocks (UA, NKE, ADDYY) Are Gaining Today
Shares of athletic apparel behemoth Nike (NKE - Free Report) gained more than 3.2% in morning trading Monday after a notable analyst upgrade; its industry competitors, Under Armour (UA - Free Report) and Adidas (ADDYY - Free Report) , were also up thanks to a newly-inked sponsorship deal and the continuation of positive momentum.
From Worst to Best?
Heading into the week, Nike was the worst performing component of the Dow, but apparently that hasn’t scared away everyone. The sneaker giant received an upgrade from HSBC to “buy” from “hold” on Monday, and the ratings firm also bumped its price target up to $60 per share from $50.
“The company epitomizes, in our view, the 'captain of industry' status in a growth sector, and even though we accept that alternative brands may be gaining share at times, we feel the company is still poised for superior growth and returns long term,” said HSBC in a note.
Under Armour Goes Yard
We can assume that one of the “alternative brands” that HSBC mentioned is Under Armour, an athletic apparel maker whose sneaker profile has skyrocketed thanks to its endorsement of two-time NBA MVP Steph Curry.
Under Armour’s brand was further legitimized on Monday as the company announced a 10-year deal to be the official on-field uniform provider of the MLB. The sponsorship doesn’t start until the 2020 season, but its importance for Under Armour can’t be understated; this is the first professional sports league deal for the Baltimore-based company.
Shifting Momentum for Adidas?
For Adidas, Monday’s trading activity seems to be coming from the overall strong start to the week for stocks, as well as a continuation of its recent momentum. The German athletic giant has struggled since its lackluster Q3 earnings report, but shares of started to turn things around over the last few days of trading.
Overall, the stock has lost about 3% over the past four weeks, but shares are up over 3.75% in the past week.
Bottom Line
Today is a day to celebrate for the world’s largest sneaker companies. Under Armour has inked a monumental deal that will help cement the legacy of its brand, while Nike and Adidas are showing signs of turning things around after some long-term and short-term difficulties. With the holiday quarter in full swing, things could get interesting in this sphere soon.
Stocks that Aren't in the News. Yet.
You are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. Many of these companies are almost unheard of by the general public and just starting to get noticed by Wall Street. They have been pinpointed by the Zacks system that nearly tripled the market from 1988 through 2015 with a stellar average gain of +26% per year. See these high-potential stocks free >>