The "Swoosh" logo is seen on a Nike factory store
Getty ImagesNike and Lululemon athletica athletic are slated to report earnings this week and next, and while analysts are still bullish on both, foot traffic may be a sticking point for the athletic gear makers, as rough weather roiled much of the country last month.
That’s according to the latest data from Placer.ai, which found that visits to both Nike (ticker: NKE) and Lululemon (LULU) skidded in February.
The companies saw steady improvements in recent months, so much so that by January foot traffic was down just over 20% year over year at Lululemon and 14% at Nike, respectively.
However, February showed a marked slowdown, with visits declining just under 31% year over year for Lululemon and nearly 36% for Nike.
The declines are likely from colder weather and winter storms in many parts of the country, as well as the ongoing threat of Covid-19, as vaccinations efforts weren’t as widespread last month as they are now. Nor are Nike and Lululemon’s results outliers, given that much of the retail industry faced difficult traffic patterns this winter.
In addition, the Placer.ai data showed that both companies held up relatively well in February compared to 2019 levels. Lululemon and Nike were down around 11% and 22%, respectively, last month on that two- year basis, and “the ability to achieve the numbers they did in the face of the wide range of retail obstacles was impressive and indicative of a sharp rebound in March,” the firm notes.
Analysts have tended to agree, with Nike garnering a lot of positive attention ahead of its earnings report, due out on Thursday. The tone on Lululemon has been a bit more subdued, with analysts citing challenging weather, but still positive on the longer-term outlook.
Nike was up 0.08% to $145 in Monday afternoon trading while Lululemon was down 1.9% to $308.27.
Write to Teresa Rivas at teresa.rivas@barrons.com
March 17, 2021 at 02:33AM
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Fewer Customers Visited Nike and Lululemon Stores in February. Analysts Are Still Bullish. - Barron's
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