Japanese Brand Benefits from Pandemic-Fueled Running Boom and Fashion Trends

  • Asics stock quadrupled over the past two years
  • Revenue in last reported quarter grew 14% from a year earlier and operating profit surged 53%
  • Asics has a strong presence among runners with 15 million loyalty program members globally
  • The company’s SportStyle division saw a 52% YoY revenue growth in the last reported quarter
  • Asics shifted focus to premium products and increased e-commerce sales
  • Asics trades at a higher multiple than Nike but similar to Deckers Outdoor

Asics, the Japanese running shoe maker, has seen its stock price quadruple over the past two years due to strong financial performance and increased demand for ‘dad sneakers.’ The company’s revenue grew 14% in the last reported quarter while operating profit surged 53%. Asics has a strong presence among runners with nearly 15 million loyalty program members globally. Its SportStyle division, focused on fashion-minded shoes, saw a 52% year-over-year growth in revenue. The company has shifted focus to premium products and increased e-commerce sales. Asics trades at a higher multiple than Nike but similar to Deckers Outdoor.

Factuality Level: 8
Factuality Justification: The article provides accurate and objective information about Asics’ financial performance, growth in the running shoe market, and the popularity of their shoes among runners and fashion enthusiasts. It also discusses the company’s strategic moves such as acquiring race-registration companies and shifting its product mix to more premium products. The information is well-researched and relevant to the main topic.
Noise Level: 6
Noise Justification: The article provides relevant information about Asics’ financial performance and the growth of their stock price, as well as the company’s expansion into fashion-minded shoes. However, it also includes some irrelevant details such as the history between Nike and Onitsuka Tiger, and a brief mention of Hoka and Deckers Outdoor’s sales growth. The article could have focused more on Asics’ strategies and plans for future growth to provide more actionable insights.
Public Companies: Asics (7936), Nike (NKE), Deckers Outdoor (DECK)
Key People:

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Financial Relevance: Yes
Financial Markets Impacted: Asics, Nike, Deckers Outdoor, Crocs
Financial Rating Justification: The article discusses the financial performance and growth of Asics, its impact on stock prices, and how it compares to other companies like Nike and Deckers Outdoor. It also mentions the effect of the Covid-19 pandemic on the running shoe market and the shift in consumer preferences towards comfort footwear.
Presence Of Extreme Event: No
Nature Of Extreme Event: Other
Impact Rating Of The Extreme Event: Minor
Extreme Rating Justification: There is no extreme event mentioned in the article. The focus is on Asics’ financial performance and growth in the running shoe market.

Reported publicly: www.wsj.com