Nike wins teen vote, but this shoe stock may have an edge



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Stocks of shoes and clothing are attracting attention.

A survey of 10,000 American teens released Tuesday ranked Nike number one in their favorite shoe and clothing brands, with Adidas also ranking in the top three for shoes and fourth alongside Lululemon for clothing.

Analysts at Wedbush also revealed their optimism for the group in a note on Tuesday, hedging 18 footwear and apparel stocks and giving Under Armor, Nike and Adidas outperformance ratings.

However, supply chain issues plagued the space over the past month, with Nike down more than 8% and Adidas down almost 12%.

Another popular shoe stock is worth considering, Inside Edge Capital Management founder Todd Gordon told CNBC’s “Trading Nation” on Tuesday.

“I love Crocs. This company kind of reinvented itself,” said Gordon, whose company owns shares. “They’ve made an incredible comeback with the teen market.… It’s only seen massive growth in recent years.”

Up more than 118% year-to-date, Crocs stock still has trendline support at current levels and remains well valued, Gordon said. Shares rose nearly 1% on Tuesday to $ 136.92.

Although retailers grapple with supply chain issues related to Vietnam’s Covid-19 restrictions, Crocs could have an advantage, Gordon said, adding that he would look at the company’s earnings report in late October. to see what he said about sourcing in Vietnam.

“They’ve been increasing their debt lately, which is a problem, but they’re a direct-to-consumer operator. Half of their income comes from where other names (…) are wholesale income.” Gordon said. “[Crocs’] the operating margins are far superior because they exploit this digital leverage. “

Another trader was also monitoring the impact of Vietnam’s supply chain.

“There is a lot of demand for Nike,” Chantico Global founder and CEO Gina Sanchez said in the same interview. “I think it’s one of the best choices. It’s the one we have in our portfolio for our client strategies at Lido Advisors. But the supply is just affected by what’s going on in Vietnam right now. “

With 50% of its shoes coming from Vietnam, Nike will continue to face a “big challenge” ahead of the holiday season, Sanchez said.

“Once these shoes are made, the transit times are twice as long,” she said. “Nike has a lot of challenges in getting the shoes off the shelves in time for the holiday rush.”

Disclosure: Inside Edge Capital Management owns shares of Crocs. Lido Advisors owns shares of Nike.

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