Refocus on retailers
After years of building the direct-to-consumer channel, sports giant Nike now wants to refocus on retail. They were able to raise their margins with leaving retailers more and more out of the equation but they also lost presence within shops and malls. Now management is turning their strategy and I think that is a good idea. Other investors obviously are of the same opinion: Nike stock is up +5% today after the news. They already reached out to Foot Locker, Macys and others to renew their partnership and make their products more visible again out in the markets.
Ready for comeback?
While they had problems during the past quarters with high inventories Nike had to do price promotions and give rebates to sell all those sneakers. People didn’t have much money left with the high inflation. Stock suffered and is still -30% down from ATH.
But now with inflation easing and a very likely soft landing of the economy it’s time for a comeback, don’t you think? The Nike brand is still one of the most valuable and strongest in the world. In my view this could be one of the big turnarounds during the upcoming bull market since the company has proven during past decades that it is able to work through such times and come back even stronger.
What do you think? Does Nike have what it takes to recover and climb new highs?
