Retail Callouts (9/17): NKE, AdiBok, TGT, JWN, HBC, WMT, AMZN

Takeaway: NKE unveils the Lebron 12 - little new in this release. Hainer feeling the heat at Adi. UPS boosting staff for Holiday demand.

Wednesday (9/17)

  • PIR - Earnings Call: 4:30pm


Thursday (9/18)

  • RAD - Earnings Call: 8:30am







  • "The LEBRON 12 is designed to enhance James’s explosiveness while combining three key benefits: superior cushioning, harnessed support and natural flexibility."


Retail Callouts (9/17): NKE, AdiBok, TGT, JWN, HBC, WMT, AMZN - 9 17 chart1


Takeaway: The Lebron 11 sold about $300mm at retail despite the fact that King James wore the shoes only 35 times during the 2013-14 NBA regular season and playoffs, 36% of the time. The new 12's feature a few surface tweaks, but for the most part look very similar to last year’s model. The one notable addition - hexagonal  Nike Zoom air bags on the sole. Not the type of innovation we are used to seeing from NKE around these releases, which allow the brand to take up AUR because of new technology. The new model will retail for $200, flat when compared to the Lebron 11, after a 10% price hike last year. 


AdiBok - Adidas Shares Jump on Report of Hedge Funds’ Interest in Stakes



  • "Adidas AG rose the most in more than 10 months in Frankfurt trading on a report that hedge funds including Third Point LLC may take a stake and are pushing to remove Chief Executive Officer Herbert Hainer."


Takeaway: Hainer has been feeling the heat since the big guide down at the end of July. The golf business is a big black eye for the CEO, but let’s not forget that NKE has been eating Adi's lunch in in almost every category and geographic region across the globe…including its own back yard. Over the last 6mnths of reported results for each company Adi has grown sales in W. Europe 6%, compare that to Nike at 24%. Not a big shock that investors are calling for Hainer's job given that he has started to divert his attention towards other interests including the role of President and Business Chairman of the Bayern Munich football club (a role he stepped down from on 9/8). That, and the fact that he's been unable to consistently grow the core brand in key markets on a sustainable basis without relying on acquisitions.




TGT, JWN, HBC - Comments on Entering Canada


HBC’s CEO explains why Target botched its Canadian launch—and why Saks will do better



  • "I’m opening up two stores, not 100-and-whatever stores. They paid $1.8-billion for leaseholds, then they paid $10-million per store to fix them up. They had no office, they had no buyers, they had no planners, they had no distribution centre, they had no POS [point-of-sale] system, they had no IT backbone. They created everything from scratch while we’re coming in very quietly opening up two stores with existing infrastructure."


Starting with one store was a good idea: Nordstrom



  • "'It’s been surprising, the amount of work to be done to open in another country. We knew it going in, but it is literally every business function … the complexities of opening, just operationally, have been challenging,' he said."
  • "'We’re opening one store. I feel good about that decision because we can respond to one store and see what happens. We will open our doors and we will look to respond to customer comments right off the bat.'"


NKE - Nike pulls Adrian Peterson merchandise off Twin Cities shelves



  • "Another NFL sponsor clearly is getting uncomfortable with the recent Ray Rice and Adrian Peterson incidents."
  • "This time, it's Nike, which, according to the Associated Press, has pulled Peterson's merchandise off the shelves of its Twin Cities store."


TGT - TargetExpress to open in San Diego



  • "Target plans to open its sixth TargetExpress store, in the South Park area of San Diego, in July 2015."
  • "At approximately 19,000 sq. ft., the store will be about 14% of the size of a standard Target store (135,000 sq, ft.). Similar to other TargetExpress locations, it will offer an edited assortment that is locally relevant."


WMT - Wal-Mart Under Fire by Xinhua for Dismissed China Workers



  • "'Wal-Mart Stores Inc. sent a chilling message to whistle-blowers by firing four Chinese staff who accused it of food-safety violations, and authorities should intervene, a state-media commentary said."
  • "'Relevant authorities need to step in quickly, and not let such suspected acts of revenge be carried out with impunity,' Xinhua reporter Zhang Chen said in a four-sentence post to the official Xinhua News Agency’s microblog.


AMZN - UPS Boosts Seasonal Hiring, Plans for Surge in Deliveries



  • "United Parcel Service Inc. said Tuesday that it plans to hire between 90,000 and 95,000 seasonal employees this year and is taking additional steps to support an expected surge in deliveries during the holiday season."
  • "Last year, the company had initially expected in October to hire 55,000 seasonal workers, but it ended up actually hiring 85,000 for the season."
  • "The logistics company said much of the sharp increase in package deliveries this year will be driven by e-commerce purchases, and the surge will begin in October and continue through January 2015. Last Christmas season, nearly 60% of all U.S. deliveries by UPS were e-commerce packages to consumers, compared with about 40% for all of 2012."


WMT - Wal-Mart Spokesman Quits Over Falsified Resume



  • "On Tuesday, it was learned that Tovar’s departure was precipitated by the fact that he falsified his résumé. Wal-Mart found out that Tovar had never finished school at the University of Delaware, but claimed on his résumé to have earned a bachelor’s degree."


MW - Men's Wearhouse promotes Blake to president



  • "The Men's Wearhouse board of directors has promoted Mary Beth Blake to the position of president and chief merchandising officer. She was previously EVP and chief merchandising officer, and will continue reporting to CEO Doug Ewert."

7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

read more

Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

read more

GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

read more

Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

read more

Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

read more

Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

read more

People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

read more

UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

read more

Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

read more

Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

read more

An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

read more

Got Process? Zero Hedge Sells Fear, Not Truth

Fear sells. Always has. Look no further than Zero Hedge.

read more