LeBron’s kicks are weighing down Nike
Nike’s stock got unlaced on Wednesday, falling 3.8 percent as investors feared a slowdown in sales gains in the latest quarter might linger.
The sneaker giant late Tuesday reported a lower-than-expected rise in future orders, the result, in part, of sagging sales of shoes with the LeBron James and Kevin Durant brands, said analysts.
“The LeBron and Durant category has been losing share all this year,” said Canaccord Genuity analyst Camilo Lyon, noting that Nike’s future merchandise orders in North America were up a “paltry” 1 percent versus consensus estimates of 4.4 percent.
What’s really ailing Nike is stiffened competition from rival Under Armour and Adidas, which have been aggressively grabbing market share this year.
Golden State Warriors’ Stephen Curry shoes with Under Armour are less expensive than the top shoes in the LeBron and Durant lines and are outperforming their Nike rivals at retail, analysts said.
The new LeBron and Durant shoes that came out in July are selling for about 12 percent less than their previous versions.
The priciest Curry shoes go for $135, the LeBron’s 13 will cost $175, and the new KD 9’s cost $150, or $30 less than the previous version, according to Lyon.
Michael Jordan shoes, meanwhile, Nike’s flagship sub-brand, are still “growing nicely,” said NPD Group sports analyst Matt Powell.
The last time Nike lost market share to Adidas was in 2009, said Lyon, and it took two years for Nike to recover from the beating.
Nike shares closed Wednesday at $53.25.