Welcome to the latest episode of the Full-Court Finance podcast from Zacks Investment Research. On this episode, Content Writer Ben Rains discusses Nike (NKE - Free Report) and tells investors what to expect from the sportswear giant's upcoming fourth quarter financial results, which are due out Thursday. Rains then dives into everything investors need to know about Puma SE PUM.DE after the German sportswear company decided to jump back into basketball for the first time in 20 years.
Nike is coming off a relatively rough quarter, based on its own high standards, with many investors nervous about the company’s sliding North American sales. Many, including Nike executives, have pointed to the shifting retail landscape and increased competition from the likes of Lululemon (LULU - Free Report) and rival Adidas (ADDYY - Free Report) , as major reasons for this recent downturn.
With that said, Nike now thinks it will be able to successfully navigate its domestic setbacks, while it continues to grow internationally. The company is expected to see its Q4 revenues climb by 8.2% to hit $9.39 billion, based on our current Zacks Consensus Estimates. Meanwhile, its quarterly earnings are projected to pop by 6.67% to reach $0.64 per share. But investors should pay close attention to Nike’s North American sales figures and watch out for e-commerce and digital sales, which have become Nike’s focus in a retail age that Amazon (AMZN - Free Report) and other online sellers helped transform.
Moving on, Puma decided to make a performance-based push in the U.S. market, starting with basketball. The company announced that it signed four top NBA prospects last week—two of whom ended up being drafted #1 and #2 overall. Puma also stuck to its plan of adding to its roster of music and entertainment talent.
The company announced that it signed Jay-Z as a creative consultant for its new basketball division. The rapper and entertainment mogul joins a list of Puma partners that include Rihanna, Selena Gomez, Big Sean, and more—Puma’s non-sports push mirrors fellow German giant Adidas’ push into non-performance sportswear, athleisure, and streetwear with the help of Kanye West and others.
Puma has somewhat quietly amassed a strong roster of stars who have an outsized influence on social media channels, such as Instagram (FB - Free Report) and Twitter (TWTR - Free Report) —which are hugely important in the online shopping age. Now that the company has jumped back into basketball, Nike and Adidas might have to try a little harder to stay on top. Meanwhile, Puma’s move puts even more pressure on Under Armour (UAA - Free Report) .
As a reminder, if you feel that we missed something, or if you have any topic suggestions, shoot us an email at email@example.com. Make sure to check out all of our other audio content at zacks.com/podcasts, and remember to subscribe and leave us a rating on Apple Podcasts.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>