Nike Inc (NKE)

An international, global brand. As emerging markets get money, they like to buy brand names, rather than generic names. This had a wonderful move in the last couple of years. It consolidates for a bit and then he thinks it will get another leg up. Dividend yield of 1.16%.

This is a global brand and they have a lot of technology behind their products. Competition is always heating up, but they are a big company with a lot of money they can spend on R&D, marketing and branding. Long-term she thinks they will do fine. A good name to go to if you want to start a position.

Nike (NKE-N) or Under Armour (UA-N)? If you are older than 25, you are probably still a Nike person. If you are under 25, you are probably with Under Armour. In terms of going forward, you are probably going to go with Under Armour, because it looks like they are going to have a better growth rate. Valuations on both are high, so he wouldn’t rush out to buy. Valuations on both are far too extended right now.

(Market Call Minute) Has done fabulously well and is folding back down on itself. It is not supported by fair market value.

The industry has just had a huge amount of growth. They have some pressure from Adidas, which is really coming out with new lines. You have Under Armour (UA-N) on the other side. When you put it all together, this has been one of the few bright spots in retail. The 3 of these trade at multiples well beyond what others are trading at. She would be a little cautious.

(Market Call Minute) A good entry point. They are consistent generators of ROE.

Just reported and were disappointing on their revenue and future order front. Thinks the shoe business has peaked out.

He likes this. It has kind of meandered down recently, and is at a critical support level at $53-$54, a previous February low. If it falls below, there might be a technical problem. They are moving more and more into women’s athletic wear and trying to penetrate that market. They are also moving into China as well. Those are their 2 major growth engines. Trading at 23X earnings and he thinks the market is shifting slightly away from growth names into some of the value names. This is not necessarily a value name. However, you are paying 23X for 13% growth.

(Market Call Minute.) Valuation is a little too high. Other companies are starting to steal market share. Thinks that the best growth days for them are over.

One of the preeminent sportswear companies. They have very high market share, but also have a lot of competition. Haven’t demonstrated that they are necessarily able to get into a space like yoga wear successfully and become one of the well-known brands. Feels that over the medium and long term they will do well. This is something you want to accumulate over time on pullbacks.

This has been a great performer over the last couple of years. Scores in the top 5% on price momentum. Valuation is still pretty reasonable. Very strong ROE’s at 30%. 25X PE looks a little rich, but they have a history of continuing to find new sources of revenue and growth.

It is a great brand name and longer term you will be fine holding on to it. These short term moves are hard to call. When you get a pullback in these companies, it is an excellent buying opportunity.

It came down nicely and this is an opportunity to buy more. They beat earnings 15 quarters in a row. They are shareholder friendly and just announced a share buyback program. Margins in the US are a risk, as well as climbing inventory levels.

(A Top Pick March 16/15. Up 20.8%.) Had a 2 for one stock split. Sales in China were awesome with something like 35% more basketball shoes. Sold his holdings last fall, almost at the peak, when it was trading at 30X earnings. Still pretty highly valued. Would prefer it in the low 20X earnings.

World’s largest maker of apparel and footwear. Footwear is 60% of their revenue. They continue to do well across all lines in key geographies, including China. Their big opportunity is in women’s apparel on a go forward basis. Have beaten consensus earnings in the last 14 consecutive quarters. Recently announced a 14% dividend increase and a $12 billion share buyback. Growth rate is probably 14-15%. The recent weakness, down to the 200 day moving average, represents a good buying opportunity. Dividend yield of 1.09%.