Editor's Note: This is a complimentary research excerpt from Retail Sector Head Brian McGough. For more information on our services, click here.
• "Nike, which recently signed Johnny Manziel to an endorsement contract, is wasting no time cashing in. At Texas A&M's pro day on Thursday, Manziel elected to wear Nike full pads and helmet, a move that surprised scouts and the media since most players do not suit up with a helmet during these types of workouts. Nike tweeted out a link to buy all the items from the Manziel 'Pro Day Collection.'”
Takeaway from Hedgeye’s Brian McGough:
Let's be clear. We still think that Texas A&M quarterback Johnny Manziel is a colossal, gigantic, enormous, huge blow-up risk.
But we give Nike a lot of credit on how they're handling this one.
Their old method was:
1) Endorse big athletes;
2) Stick them in ads; and
3) Hope that it trickles down to the mainstream product.
In this case, though, Nike has a full array of products associated with Manziel for Pro Day –far from when he even will even see a snap in the NFL. This marks a fundamental change for how Nike is handling endorsements.
We still don't like the stock here…but we do like this development.