Sketchers (SKX) sold off on Q3 disappointment but we think this is a one-off and the reaction has been overdone. The shares are actually fairly cheap. Then there is this:
- Total U.S. athletic footwear point-of-sales rose 10.7% Y/Y for the week ending December 12, according to data from Sportscan.
- Unit sales were up 5.7%, while the average selling price increased 4.7% during the week. Both marks easily top growth rates across broad retail.
- Sales in the basketball category were up 20% from the corresponding week a year ago. Nike (NYSE:NKE), Adidas (OTCQX:ADDYY), and Under Armour (NYSE:UA) are the dominate basketball players, while Foot Locker (NYSE:FL) and Finish Line (NASDAQ:FINL) are thriving selling channels. On a side note, Finish Line's website was queuing visitors this morning due to heavy traffic.
- The casual athletic footwear category was up even hotter than basketball with a 32% pop. Wolverine Worldwide (NYSE:WWW) and Skechers (NYSE:SKX) are likely to have scored a lot of that action. Nike's Converse brand is also a major force in casual athletic. Sales of the iconic Chuck Taylor line have almost doubled over the last five years to top $2B.
- Running shoes sales increased 7.6% during the key week.
- Sector leader Nike reports earnings on December 22. A strong read on futures orders could resonate across the industry.
- Previously: Confidence in Nike ahead of earnings week (Dec. 18)