Nike is poised to win at the summer Olympic games in Rio this August, according to Goldman Sachs, acting as judge representing Wall Street.

That’s partly due to the sportswear giant’s training regimen. Nike Inc. has in the past successfully used the games as a launch pad for new products.

But the Olympics can also be expected to provide a platform for other brands, especially Under Armour Inc., even though the local economy in Brazil is going through something of a bust, with apparel sales down 12 percent in the first quarter.

Goldman said that about 3.6 billion people tuned in to the 2012 London games, with 100,000 hours of global television coverage and 150 million tweets.

“This greater flow of conversation via social media provides athletic brands — which are also steering the conversation through traditional ads, endorsements and their own social media — with even more firepower to authentically reach consumers,” Goldman analysts, led by Lindsay Drucker Mann, wrote in the report.

Goldman noted that Nike launched its Lunar Foam, which is 30 percent lighter and more durable than other midsole cushioning, at the 2008 games and the Flyknit fully knitted sneaker upper at the 2012 games and built both in to $1 billion businesses.

“As the largest athletic brand in the world, the official sponsor of the games (replacing Adidas, the official uniform supplier to the [International Olympic Committee], Nike is well-placed to capitalize on the growing reach of the Olympics and its stable of new product innovations,” Goldman said.

While footwear leads the way for the brand, Nike also have new offerings in apparel, including the Aeroswift technology that offers more advanced wicking and stretching and will be showcased in Olympic soccer, track and field and basketball.

(Nike no doubt welcomed the boost from Goldman. Elsewhere in the financial world, Telsey Advisory Group analyst Kelly Chen lowered her sales-growth estimate for the firm ahead of its fourth-quarter earnings report, which is due June 28).

Nike might be a tough competitor, but it doesn’t have the field to itself.

The analysts said Under Armour arguably has the most to gain during the games since the international market represents only 12 percent of its sales and it has a larger stable of athletes competing.

Under Armour is sponsoring as many as 250 athletes across multiple events including golf (Jordan Spieth), swimming (Michael Phelps), women’s soccer (Kelley O’Hara), tennis (Andy Murray, sprints (Natasha Hastings), as well as providing the official outfits for the U.S. gymnastics team,” the report said.

load comments
blog comments powered by Disqus