Publicly listed sporting goods vendors and retailers did not perform better than the stock market in general. At $98.9 billion, their combined stock market capitalization as of Dec. 30 was 39.5 percent lower than at the same time one year earlier, completely wiping out the 16.9 percent gain they had in 2007 and most of the 25.2 percent increase they had in 2006.
The decline was roughly in line with the bleak performance of the major stock exchange indices, particularly in Europe and Japan. While the FTSE 100 lost 31.3 percent, the wider FTSE Eurofirst 300 index fell by 44.8 percent. The French CAC 40 index dropped by 42.7 percent and the German DAX by 43 percent. The Icelandic stock exchange recorded the biggest drop at almost 95 percent. The Japanese Nikkei went down by 42.1 percent.
American indexes went slightly better, but analysts remarked that such figures had not been seen since the Great Depression of the 1930s. The Standard & poor 500 marked a decline of 38.5 percent, but it was its worst run since 1937. The Dow Jones Industrial Average fell by 33.8 percent, its second-largest slide since its 52.7 percent plunge in 1931.
Our annual stock chart ranks sporting goods companies all over the world by market capitalization, converting the value of their outstanding shares from local currencies to U.S. dollars at the end of each year, taking into account equity increases and share buybacks in the course of the year. The changes in stock market prices are given in local currencies, but the recent strengthening of the U.S. dollar has lowered the rankings of non-American companies, particularly the British ones.
Nike remained the largest stock. At $24.1 billion, it represented about one-fourth of the whole industry and was three times higher than the Adidas Group, the runner-up on the chart. Nike’s stock value declined by only 24.7 percent. Other relatively good performers were VF Corporation and the Wolverine World Wide group, which went down by 21.5 and 21.0 percent, respectively. Another outdoor company, Columbia Sportswear, saw its stock market value fall by 25.8 percent.
Two sports equipment companies, Shimano and Pegasus, also performed relatively well, showing declines of 13.3 and 6.1 percent, respectively. A bigger equipment company, Amer Sports, suffered a loss of 70.7 percent, finishing well below them and the industry leader, Jarden Corporation. Head had a worse score, going down by 88.0 percent.
Above-average declines were recorded by Adidas, ASICS and Puma, but they remained among the 12 major stocks along with companies that are involved in other businesses as well such as Luxottica, parent company of Oakley, and Fortune Brands, parent company of Acushnet.
Curiously, above-average declines were also suffered by a number of Chinese companies including Li Ning, Li & Fung (No. 4 on our chart), Yue Yuen, Anta Sports and Stella Holdings. Quiksilver, which previously was among the majors on our chart, lost 80 percent of its value last year, and while their losses were much smaller, the three other surf companies on our chart – Billabong, Volcom and Pacific Sunwear – lost more value than the industry in general.
Together, the 24 footwear-based companies on our chart had a weighted average decline of 37.0 percent, while the apparel companies lost 43.3 percent of their value and the equipment companies 39.8 percent. Sporting goods retailers had a decline of 43.6 percent.
In geographical terms, European stocks had the worst score, with a combined 47.1 weighted average loss in value of the year, but Asian stocks performed almost as badly, going down by 46.4 percent overall. While JD Sports acted as a stand-out with a decline of 47.4 percent, three other British sporting goods retailers suffered ominous drops: -64.0 percent for Sports Direct, -89.7 percent for Blacks Leisure and -96.4 percent for JJB Sports. A French sporting goods retailer, Groupe Go Sport, did not fare much better as its stock value declined by 73.0 percent.
The worst score went to Crocs, whose value fell by 96.8 percent. Out of the 90 stocks that we have tracked, only The Finish Line had an increase in value last year, but this was due to the fact that one year ago this big U.S. retailer was facing the possibility of bankruptcy through its subsequently aborted attempt to take over Genesco. The company is doing much better now, but its stock is worth only about one-third the level of five years ago.
