Nike's stock falls behind rivals at Rio as Adidas and Under Armour advance
Nike has top billing among sports brands at the Rio Olympics - but a week into the games, its stock is losing to Adidas and Under Armour.
The quadrennial global sports event exposes apparel brands worn by top athletes to hundreds of millions of viewers, but growing competition and higher costs may be reducing the benefits of major endorsement deals.
Since the summer Olympics started, shares of official games sponsor Nike have risen 1pc as of Friday. But rival stocks have dashed ahead, with Under Armour up 2.3pc and Adidas 5.9pc firmer on a strong quarterly report.
Neither Adidas nor Under Armour are official Olympics sponsors. But Under Armour sponsors about 250 athletes, including US swimming legend Michael Phelps. Adidas supplies uniforms to teams including Britain and Germany, and it is releasing special-edition sneakers lined in bronze, silver and gold.
"You have increased competition. Under Armour is a public company out there now competing for more sponsorships. It's more expensive for the companies involved," said Bespoke co-founder Paul Hickey.
Following Thursday's gold-medal performances from Phelps and US gymnast Simone Biles, this weekend may be climactic for investors rooting for the shares of Nike and Dick's Sporting Goods, the official retailer of US team T-shirts and other apparel.
"This might be the weekend when people go out to stores ... Thursday night was the most excitement I've had so far," said TD Ameritrade market strategist JJ Kinahan, who is tracking the stock performance of 24 Olympics sponsors.
Ralph Lauren shares surged 12pc last week after the US team appeared at Friday's opening ceremony sporting uniforms it designed, emblazoned with the company's logo.
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