Market Overview

Baird's Stock Picks In Footwear And Fitness Amid Brexit Fallout

Baird's Stock Picks In Footwear And Fitness Amid Brexit Fallout

Baird prefers Nike Inc (NYSE: NKE), Planet Fitness Inc (NYSE: PLNT) and Duluth Holdings Inc (NASDAQ: DLTH) in the apparel, footwear and fitness sectors, despite being concerned about market volatility and political uncertainty raising the risk of a U.S./global recession in the intermediate term.

"Overall, the Outperform-rated stocks we are least concerned about in a range of potential scenarios include NKE (earnings likely insulated, even with above-average Europe exposure), as well as PLNT and DLTH which are domestic businesses with robust secular drivers," analyst Jonathan Komp wrote in a note.

Related Link: Following Brexit, Baird Likes These Auto Stocks

The analyst said the greatest short-term earnings risk for companies with above-average revenue penetration in Europe include the following:

  • adidas AG (ADR) (OTC: ADDYY)
  • VF Corp (NYSE: VFC)
  • Nike
  • Crocs, Inc. (NASDAQ: CROX)
  • Deckers Outdoor Corp (NYSE: DECK)
  • Foot Locker, Inc. (NYSE: FL)
  • Genesco Inc. (NYSE: GCO)
  • Wolverine World Wide, Inc. (NYSE: WWW)

All these companies are estimated to have more than 10 percent revenue mix in Europe.

But What If...

In the event of a U.S./global recession, the analyst sees downside earnings risk for higher-fixed cost retail businesses such as Finish Line Inc (NASDAQ: FINL), Zumiez Inc. (NASDAQ: ZUMZ), Boot Barn Holdings Inc (NYSE: BOOT), Genesco and Foot Locker.

Komp is also concerned on branded apparel/footwear vendors with the lowest existing operating margin including Crocs, Rocky Brands Inc (NASDAQ: RCKY), Deckers and adidas. In addition, high-valuation names like Under Armour Inc (NYSE: UA) and adidas would be exposed in the event of a recession.

Latest Ratings for BOOT

Jan 2021JP MorganUpgradesNeutralOverweight
Nov 2020Wells FargoUpgradesEqual-WeightOverweight
Oct 2020Wells FargoMaintainsEqual-Weight

View More Analyst Ratings for BOOT
View the Latest Analyst Ratings


Related Articles (CROX + BOOT)

View Comments and Join the Discussion!

Posted-In: Athleisure Baird BrexitAnalyst Color Long Ideas Short Ideas Analyst Ratings Trading Ideas

Latest Ratings

TSLAJP MorganMaintains125.0
INTCTruist SecuritiesMaintains64.0
FBTruist SecuritiesMaintains320.0
AAPLCowen & Co.Maintains153.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at