Denim’s back – great news for Nike?
Accessible sports apparel and fashion seller, Nike, might be in for a run of good luck. According to global financial services company UBS, jeans are on their way back in. A research note the company sent out says that as the athleisure trend “moves past its peak a strong denim cycle has begun.” This is obviously great news for Levi’s, but how does it benefit Nike? According to UBS, sales of basketball shoes – which are a huge category for Nike – are historically correlated with trends towards wearing denim.
Nike’s share price has risen by 16% so far this year
Source: Yahoo Finance
Nike is the undisputed global market leader when it comes to basketball footwear, with its Jordan brand being almost totally devoted to the sport in which its namesake made his mark. Combined, Nike basketball and Jordan sold $4.3 billion of product last quarter in wholesale alone!
But don’t be too wowed by that figure – for the past two years, basketball shoes have struggled to sell as well as Nike (and others) would like. The reason? Slim fitting athleisure trends simply don’t mix with basketball shoes’ high-top designs. If that’s about to change, then given Nike’s dominance in the category, they could be in line for a slam dunk!
Dominion holds Nike in its Global Trends Luxury Fund.
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