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BofAML weighs in on sports apparel makers, retailers positively

  • BofAML analyst Robert Ohmes hikes his PT on a number of sports retail and apparel names.
  • VF (VFC -0.4%) is reiterated at Buy with an increased PT of $70 ($62.50 previously). Ohmes is bullish enough on VF's earnings mix move towards higher margin, faster growing segments to assign a premium relative to VF's historical multiple.
  • Dick's Sporting Goods' (DKS +0.1%) PT is raised to $68 ($65 previously). Ohmes notes Dick's "appeared to maintain strong traffic throughout the Holiday period supported by an increased TV/digital marketing effort and store payroll investments ... DKS remains our top pick following our post-Holiday store checks."
  • Under Armour (UA +0.4%) is reiterated at Buy with an increased PT of $95 ($85 previously). Ohmes: "Near-term top-line momentum should continue to be driven by expansion in core apparel, Direct to Consumer, and improving footwear trends. Longer term, UA should triple in revenues through growth in footwear (should become larger than apparel) and International (should become as large as the US)."
  • Foot Locker's (FL +0.5%) PT is raised to $45 ($43 previously) on the back of the retailer's improving cold weather category and athletic footwear outlook.
  • Columbia Sportswear (COLM +0.3%) is reiterated at Sell with a PT of $58 ($50 previously) due to the same drivers as Foot Locker. Risks to Ohmes' Sell thesis include favorable weather trends, EPS accretion from the Swire JV beginning in 2014, long term operating margin upside, and opportunities in the footwear and women's categories.
Comments (1)
  • vollbarry
    , contributor
    Comments (69) | Send Message
     
    If Columbia is a sell then why did they raise the price target?
    27 Dec 2013, 10:25 PM Reply Like
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