- A Basket of sportswear stocks, including Nike, Adidas and Puma returned just 18% in five years
- However, in past busy sports summers, their value jumped by as much as 12%
- Whilst some top brands have struggled, others have seen phenomenal growth, from Asics to golf group Acushnet
Tuesday, 18th June 2024 – Analysis from trading and investing platform eToro suggests that the world’s biggest sportswear brands could be in for a much-needed share price boost as a ‘sporty summer’ heats up in the US and EU.
eToro created a market capitalisation-weighted basket of 10 of the biggest sportswear brands in the world and found that in the comparably busy period of June to August in 2016 and 2021, the value of these firms rose between 11-12% from June to August, significantly outperforming major stock market indices.
These sporty seasons saw a glut of major events where the world’s biggest sports brands gained huge exposure, from the European Championships and Copa America football tournaments, to the Olympics, Tour de France, golf majors and Wimbledon Championships.
According to eToro’s analysis, any repeat of the share price bounce seen in previous years would be more than welcome for these brands, given they have collectively returned just 18% to shareholders in the last five years – a fifth of the 88% generated by the S&P 500 over the same period. The sportswear basket has performed particularly poorly in recent times, down 8% so far this year versus the S&P 500’s 10% gains.
Commenting on the findings, eToro Analyst Josh Gilbert said: “In the next few months, the world’s biggest sportswear brands will be gaining maximum exposure with billions of TV viewers tuning in to watch the Euros, the Olympics, State of Origin and other blockbuster sporting events. Not only will we see sports fans supporting their favourite teams by buying their favourite jerseys, but it will often inspire consumers to upgrade their sports wardrobe. Although Australia isn’t getting that summer sports boom, we will see hundreds of thousands flock to the snowy mountains, and brands like Anta Sports and Amer Sports will certainly be on show.
“Any Olympics and Euros-inspired boost will be warmly received, given the fairly stagnant performance some of these firms have seen over the last five years. After enjoying a pandemic boom as consumers had extra cash in their pockets and fewer things to spend it on, several of the biggest sports names have been suffering a post-pandemic hangover with cost-of-living constraints also playing their part.”
Whilst the basket of stocks may have collectively performed poorly in recent years, returns across this group of companies have varied, with major winners and losers.
German heavyweight Adidas has seen its value drop 11% in the last five years, though this pales into insignificance compared with Baltimore-based Under Armour, which has lost more than 70% of its value over the same period. However, at the more luxury and specialist end of the market, brands have fared much better, with athleisure brand Lululemon enjoying healthy share price gains (85%) over five years, while go-to running brand Asics has soared 620%.
Josh Gilbert continues: “Whilst the next few months are a pivotal moment for these brands, there are also structural signs that they could be well-positioned to rally. Inflation continues to ease, giving consumers more spending power, whilst the stocks are trading at a near-bottom range of 24 x P/E valuation ratio, making them effectively cheap.
“It’s also important to recognise just how brilliantly some of the companies in our basket have been doing. The rise of golf, running, and snow sports have helped brands such as Acushnet, Asics and Anta Sports in the last five years. ”
| Table showing sportswear basket of stocks versus major indices | ||||
| Basket/indices | Returns ytd | Returns 1 year | Returns 3 years | Returns 5 years |
| Sportswear brands | -8% | -5% | 73% | 18% |
| ASX 200 | 2% | 8% | 8% | 20% |
| S&P 500 | 10% | 24% | 25% | 88% |
| NASDAQ | 11% | 33% | 125% | 113% |
**Data from May 2024. Past performance is not an indication of future results.
| Table showing performance of brands included in global sportswear basket | ||||
| Brand | Returns ytd | Returns 1 year | Returns 3 years | Returns 5 years |
| Nike | -14% | -12% | -32% | 18% |
| Adidas | 24% | 48% | -23% | -11% |
| Puma | -7% | 2% | -50% | -11% |
| Fila | 1% | 5% | -29% | -50% |
| Asics | 99% | 132% | 235% | 620% |
| Lululemon | -41% | -10% | -6% | 85% |
| Under Armour | -21% | -5% | -69% | -70% |
| Anta Sports | 10% | 3% | -47% | 78% |
| Acushnet (Titleist, FootJoy) | 2% | 43% | 22% | 169% |
| Amer Sports* (Wilson, Salomon) | n/a | n/a | n/a | n/a |
* Amer Sports IPO on February 1st, 2024
**Data from May 2024. Past performance is not an indication of future results.
| Performance of sportswear basket in past busy sports summers | |
| Performance June-August 2016 | 11% |
| Performance June-August 2021 | 12% |
*ENDS*
Notes to editors
About this data
eToro’s sportswear basket is a market-cap weighted 10-stock basket constructed with 10 of the largest global sportswear companies. Data source: Refinitiv. Data from May 2024.
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