The last five Summer Olympics have been very lucrative for Nike. This year, the world's leading athletes will again wear Nike uniforms.
A leading manufacturer of sportswear and footwear hopes that the general enthusiasm for the Olympic Games will extend to its brands, writes the Wall Street Journal.
Although Nike takes advantage of a diversified lineup that is not tied to any single market, price or consumer demographics, the company warned investors earlier this year that inventories in some markets were larger than planned, especially in clothing markets in Europe and China.
Analysts want to find out at what level Nike stocks were at the end of the last quarter ending May 31. At the end of each of the last four quarters, this figure increased by at least 32%, and according to Canaccord Genuity analyst Camilo Lyon, for most of this period, inventory growth outpaced sales growth more than ever in the last 11 years.
Nike stock has outperformed the S&P 500 in each of the last five Summer Olympics, gaining an average of 24,5%, according to Barclays. However, Nike has only gained 3,1% since the start of this year, while the S&P 500 is up 6,2%. Analysts believe the company was under pressure from negative macroeconomic comments on Europe and China.
“As the macroeconomic situation in Europe continues to deteriorate, already inflated stocks ahead of the Olympics may increase further if the sell-off during the Olympics turns out to be disappointing,” Lyon said. Writes about this "Asian Reporter" (asiareport.ru).