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Will Losing A Foothold In China Affect This Retailer's Performance?

Tickers in this article: COLM HBI ICON LULU NKE SKX UA

The market for consumer goods in China is often depicted as some sort of holy grail for retailers, with its enormous population and ever-growing middle class. But sporting apparel giant Nike Inc. (NKE) serves as a word of caution.

[Read more from Kapitall: Consumer Prices Rose But Shoppers Always Stop At The Drugstore]

After three decades selling its wares to Chinese consumers, you'd expect Nike to enjoy strong growth among sales there. But yesterday Bloomberg reported the company expects Chinese sales to fall over the next two quarters, making that a streak of five quarters in a row. 

Besides losing customers to competitors such as Adidas AG (OTC) , Nike has failed to shift a large portion of merchandise in China it had stockpiled in preparation for a boom in sales after the Beijing Olympics – one which never came to be. 

Nike is currently trading at $63.43, close to its 52-week high of $66.07. But the stock's performance this year has lagged many of its competitors.  

We decided to look for outperforming stocks – those with a performance over the last quarter above 20% – among a universe of companies producing and selling athletic footwear and clothing, and compare them to Nike.  

The List

For an interactive version of this chart, click on the image below. Average analyst ratings sourced from Zacks Investment Research.

Dig Deeper: Compare analyst ratings to annual returns for stocks mentioned

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The companies below are listed starting with the highest performance over the last quarter. Do you use recent performance figures when considering new investments? Use this list as are a starting point for your own analysis.

1. Skechers USA Inc. (SKX): Engages in the design, development, marketing, and distribution of footwear for men, women, and children in the United States and internationally. Market cap at $1.33B, most recent closing price at $26.54.

Performance over the last week: 4.12%        
Performance over the last quarter: 24.60%
Performance year-to-date: 43.46%

 

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