Nike (NKE) stock inched up to a new high and a buy point after No. 2 athletic apparel heavyweight Adidas (ADDYY) charged over 9% higher Thursday morning on a solid quarterly report.
XAdidas Earnings, Sales Top Views
Second-quarter sales grew 10% on a currency-neutral basis to 5.26 billion euros ($6.09 billion), while basic earnings from continuing operations rose 20% to 2.06 euros ($2.39) per share, topping analyst expectations.
Adidas, its flagship brand, grew revenue by 12%. Management called out double-digit growth in its training, running and football segments and high-single-digit growth in its "sport inspired" category. But its Reebok brand tracked another decline, slipping 3%.
Direct-to-consumer sales overall increased in the double digits, including 26% online sales growth.
In the North America and Asia-Pacific segments, Adidas and Reebok sales were "particularly strong," said Adidas, with sales up 16% and 19%, respectively. Sales were also solid in Latin America and Russia, but Adidas' Western Europe sales were flat.
Adidas management reaffirmed its 2018 guidance for 10% currency-neutral revenue growth and a 12%-16% rise in basic earnings per share from continuing operations.
Piper Jaffray reaffirmed its overweight rating and 233 euro price target.
Adidas' U.S. shares sprinted 9% to 120.59 in the stock market today. They gapped above their 50-day and 200-day moving averages. Adidas stock hit a record high 133.01 on April 18.
Nike Stock Breaks Out
The Dow Jones component crept higher Thursday morning, continuing its climb over the last two weeks. Nike stock rose 0.8% to 81.14, just moving above an 81.10 flat-base entry point. Volume was light midday.
Nike stock has been ascending since October 2017, after breaking out of a cup-with-handle base. It is currently trading at record highs with a Relative Strength rating of 89.
Under Armour (UAA) stock rose 1.8%. Shares are trading below their 50-day moving average.
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The post Nike Stock Hits Buy Point As Rival Adidas Soars On Earnings appeared first on Investor's Business Daily.
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