Will a $ 350 Nike shoe make you a better basketball player?

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The new year is shaping up to be costly in the sports gear world as Nike Inc. plans to release a basketball “adaptive performance platform” with a staggering price tag of $ 350.

Nike chief executive Mark Parker didn’t give many details on what the collection of new merchandise will include, but said a “pipeline” of items that will include innovative technology is slated for 2019 and into. 2020 for the Tokyo Olympics.

“We have a smart shoe designed for the perfect fit, and this is a major step in advancing and connecting our digital transformation to the product,” he said during the earnings call of the company last Thursday, according to a FactSet transcript.

Nike NKE,
-0.75%
is already enjoying the success of the Vaporfly 4% running shoe, with its price tag of $ 250. And scientific studies have shown that the Vaporfly helps some runners run faster, making it a must-have for performance-oriented marathoners and recreational runners.

“This reputation has spread to everyday athletes, making 4% the most wanted shoe on race day, and it has created a halo effect for many of our Nike fast shoe styles, especially the Peg 35, driving double-digit growth. in the running category in [the second quarter]”Parker said.

Read:Under Armor leaves some analysts wondering if its prospects are achievable

Nike’s partnership with the National Basketball Association is driving growth, he said, with LeBron James’ move to the Los Angeles Lakers also providing an “opportunity” for the company.

The company’s iconic Jordan brand, meanwhile, has returned to growth. The Jordan line, along with the women’s line and acceleration in China, were the highlights of the most recent quarter.

See:Nike stock surges as earnings beat Jordan, women, and China earnings call for bullish analysts

“Nike appears to be broadening its thinking on the longer term addressable global market with a view to broadening the main active categories of footwear / apparel,” Baird analysts wrote in a note.

Baird believes Nike stocks are outperforming, with a price target of $ 87.

“With a strong pipeline of new products and building digital skills, we expect more to arrive and continue to see increasing capacity for the revenue and gross margin outlook in [the 2020 fiscal year]Stifel analysts wrote. “We trust Nike to meet the macro challenges in [fiscal 2020] and gain market share and continue to view Nike stocks as a solid foundation for large-cap growth investors. “

Stifel is pricing the Nike stock purchase, with a price target of $ 96.

“Improvements in scarcity model, product pipeline speed and digitally driven consumer engagement are still in their early stages and are expected to continue for the foreseeable future,” wrote analysts at Susquehanna Financial Group directed by Sam Poser. “Due to the aforementioned improvements, Nike eliminates its competition, including Adidas ADDYY,
-1.46%
and Under Armor UA,
-1.97%.

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Susquehanna is pricing Nike stocks positive, with a price target of $ 100.

However, not all analysts are optimistic. UBS maintained its neutral stock rating and price target of $ 78, saying Nike’s digital moves, including those in the supply chain, will require “heavy investment.”

Nike shares gained 17.3% in 2018 while the Dow Jones Industrial Average DJIA,
-0.48%,
which counts Nike stock among its 30 members, lost 6.7% over the period.


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