HSBC downgrades Nike, Adidas on persisting supply chain issues
10/01/2022 11:07
** HSBC downgrades sportswear giants Nike NKE.N and Adidas
ADSGn.DE to "hold" from "buy" on sustained supply chain issues
** HSBC's Erwan Rambourg says western brands are still
facing production issues with the sector not completely out of
"the woods" with supply chain problems
** On Friday, thousands of employees at Pou Chen 9904.TW ,
which supplies to Nike and Adidas, went on strike at a factory
in southern Vietnam, demanding better year-end bonuses, state
media reported urn:newsml:reuters.com:*:nL4N2TN2AF
** HSBC's Rambourg, who also cut PTs of Nike by $2 to $182
and Adidas to EUR280 ($317.18) from EUR 305, adds that Chinese
demand for products is remaining "lackluster" for longer
** Brokerages still bullish about both stocks with an
average "buy" rating
** Shares of Nike down 0.6% at $156 in early premarket
trading, while Adidas stock was marginally up after co says it
plans to buyback up to EUR 1 billion ($1.13 billion) in Q1 2022
** Up to Friday's close, NKE had risen ~8% in the past 12
months, while Adidas had fallen ~20%
($1 = 0.8828 euros)
(Reporting by Aishwarya Venugopal in Bengaluru)
((Aishwarya.Venugopal@thomsonreuters.com; within U.S.
+1-646-223-8780; outside U.S. +91 80 6749 2830;))