Thanks Bron Bron

So will LeBron go to Miami, New York, Chicago???  From an investment vantage point, I could care less. The simple fact that I am addressing this point is a big positive for the athletic brands and retailers.

 

Can anyone remember a time when there was this much hype around an athlete’s decision to play in a given city – or to play at all? I can… It was summer of 2001 when Jordan returned (which arguably should never have happened). Heck, I even recall sitting in the hot seat in the morning meeting room of my then-buldge-bracket employer and a seasoned salesperson literally asked me in front of thousands of ears whether Jordan was returning.

 

I thought that was both sad and ridiculous at the time.  The reality, though, is that it mattered. It mattered because it was an incremental boost to the product cycle. Nike amped up its product line around MJ with the Wizards, and kicked its marketing machine into high gear. Any retailer worth its salt could not afford to miss out on that, so orders followed. Jersey sales also picked up, and Reebok had the exclusive license for ‘official’ league jerseys. Adidas has since restructured the deal such that it sells them under the Adidas logo.

 

So what are we looking at here?  With the exception of LeBron ending up in the media-market-equivalent of Outer Moongolia like Portland (Trailblazers) or in Kobe’s shadow like w the LA Clippers (it'll never happen), this event will be incremental across the board.

1)      For Adidas, they’ve been relying on World Cup and Shape Ups. WC is almost over, and Germany was sent packing by a ‘lesser’ Adidas team. Not sure when the bubble will end on shape ups, but a pick-up in Jersey sales from the most exciting free agent switcheroo will help keep adi’s momentum going for another quarter.

 

2)      For Nike, they have LeBron, Wade, Carmello, and Bosh. From an asset standpoint, they can’t lose. Now they need to execute on product and marketing. That’s where my confidence level is highest. If these three guys (LeBron, Bosh and Wade) all end up in Miami, then Nike will be giddy with how they can build up this franchise into the next season. Given Nike’s legacy in Chicago with in the 1980s and 1990s with the Jordan/Rodman/Pippen trifecta.

 

3)      Arguably, the biggest winners across the board are the retailers.  We’re only talking about a half a point to a point in comp for a company like DKS, HIBB or FL. But given that this is a business that has faced headwinds for the better part of four years, we’ll take what we can get.

 

Thanks Bron Bron - 7 7 2010 9 22 14 AM



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

REPLAY: Review of $EXAS Earnings Call (A Hedgeye Best Idea Long)

Our Healthcare Team made a monster call to be long EXAS - hear their updated thoughts.

read more

Capital Brief: 5 Things to Watch Right Now In Washington

Here's a quick look at some key issues investors should keep an eye on from Hedgeye's JT Taylor and our team of Washington Policy analysts in D.C.

read more

Premium insight

[UNLOCKED] Today's Daily Trading Ranges

“If I could only have one thing of the many things we have it would be my daily ranges." Hedgeye CEO Keith McCullough said recently.

read more

We'll Say It Again: Leave Your Politics Out of Your Portfolio

If your politics dictates your portfolio positioning, the Democrats and #NeverTrump crowd out there have had a hell of a week.

read more