…The better choice would be for Nike to acquire Skechers, giving Nike $3 billion in annual revenue, double digit growth, and for just 20 times earnings. Moreover, it would bolster Nike’s women’s and footwear business outside of basketball…
The better choice would be for Nike to acquire Skechers, giving Nike $3 billion in annual revenue, double digit growth, and for just 20 times earnings
No way SKX board would agree to a buyout at the current stock price. The premium would have to be hefty.
Another problem with a NKE buyout of SKX is that the brands and marketing are so distinct. NKE focuses on performance, uses endorsements of top athletes, and charges a premium. SKX focuses on affordable comfort, markets using “cool” pop culture icons or retired, older former athletes, and charges a relatively low price. NKE would need to maintain the SKX brand and identity separately from the NKE brand for a merger to work. In essence, NKE would be buying into a separate market segment. It’s certainly possible, but, IMO, unlikely, that NKE would choose this path.
…The better choice would be for Nike to acquire Skechers,
Cray-cray! No way Nike buys them. Same could be said for UA. Nike has been kicking butt, have you seen their chart? Straight up for a long time. Are they going to say we need to acquire to grow now because our products are starting to lose favor? Nope!
on a side note, I was talking with my wife’s cousin’s son in Aug 2010 and trying to get him interested in investing. He was about 16 at the time and he said he would invest in DIS and NKE, now up 244% and 271% since then. Kicks my butt!
Just got back from Costco and the had 1 style of men’s “leather” sneakers with memory foam. The looked like they could almost qualify for hipster sock-less sneaks. But I am too old to be sure.