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As Zion Williamson Falls, So Do Nike Shares

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As Zion Williamson Falls, So Do Nike Shares

It was the tear heard around the world.

Duke University superstar Zion Williamson, presumably the first overall pick in the upcoming draft, broke through his Nike PG 2.5 shoe while facing off in the Blue Devils' biggest game of the year against the rival North Carolina Tar Heels. 

The mishap sent Nike Inc (NYSE: NKE) shares down as much as 2 percent Thursday. Williamson is expected to sign one of the biggest rookie shoe contracts in some time and plays for Duke, a Nike school, leading many to believe he will sign with the brand ahead of his first NBA season.

"The quality and performance of our products are of utmost importance," the company said, according to CNN. "While this is an isolated occurrence, we are working to identify the issue."

Incident Raises Larger Questions 

Matt Powell of the NPD Group, who has long said basketball shoes are not in fashion and sales are declining, told CNN: "this is embarrassing for Nike, but will have no material impact on the business.”

Darren Rovell replied to Powell on Twitter Inc (NYSE: TWTR):

Nike's brand is virtually bulletproof and will likely quickly recover, but several questions persist following the game.

The overarching questions continue to be whether NCAA players should be compensated and whether the NBA should sign players directly out of high school. Tickets for the matchup between Duke and North Carolina cost nearly as much as the Superbowl.

Former Duke superstar Jay Williams said Williamson's injury is an argument for allowing players to be drafted by the NBA after high school. 

"You're talking about an athlete who could potentially get a $100-million shoe deal," Williams told ESPN Thursday. "Granted, his knee's OK. He's fine. But if he were to blow his knee out, he would make $8 million [from an insurance policy]. That is still $92 million less than he would have made with a $100-million shoe deal." 

Williamson is expected to recover, but many of these difficult questions will persist long after this incident blows over.

Nike shares were down 1.34 percent at $83.70 at the time of publication Thursday. 

Related Links:

Cowen: Puma's Q4 Strength Bodes Well For Nike, Adidas Earnings

LeBron's Move To Los Angeles: What It Means For Nike, Adidas And Puma 

Screenshot courtesy ESPN and CBS News. 

Posted-In: Darren Rovell Duke ESPN Jay WilliamsNews Sports Media General Best of Benzinga

 

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