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Clothing Companies Hitting New Lows

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DooDiligence Experienced

DooDiligence

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I've got a pair of Converse high tops (black) that I've been babying for a decade or more (got another pair new in the box for when these finally go.)

 

Most of the time I wear flip flops.

 

Love my Tommy Bahama shirts (got a deal on closeouts at an outlet a few years ago & stocked up.)

 

I'm not particularly fashion forward...

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Jurgis Apprentice

Jurgis

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Does anyone buy Tommy Hilfiger anymore?

 

I buy anything that catches my eye @ Marshalls/TJMaxx.  :P

 

Which pretty much means that I'm brand agnostic and not target audience for your question.

 

I don't buy NKE, since I don't wear athletic apparel. For my yoga/zumba/tai chi classes, I just wear Walmart/random-TJMaxx sweats + free tshirts + 20 year old Adidas sneakers... I think I have another pair of brand new 20 year old sneakers, which were gifted to me and I never wore them yet...  8) Anyone wants to buy mint condition shoe antique?  ;D

 

Edit: Actually I still have 25-30 year old shoes that were made in two countries that don't exist anymore... German Democratic Republic and Czechoslovakia...  ::) Had a shirt made in North Korea, but that's gone now...  8)

 

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rkbabang Mentor

rkbabang

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Does anyone buy Tommy Hilfiger anymore?

 

I buy anything that catches my eye @ Marshalls/TJMaxx.  :P

 

Which pretty much means that I'm brand agnostic and not target audience for your question.

 

I don't buy NKE, since I don't wear athletic apparel. For my yoga/zumba/tai chi classes, I just wear Walmart/random-TJMaxx sweats + free tshirts + 20 year old Adidas sneakers... I think I have another pair of brand new 20 year old sneakers, which were gifted to me and I never wore them yet...  8) Anyone wants to buy mint condition shoe antique?  ;D

 

Keep them another 20 years then put those on ebay.  It is amazing what people are getting for used sneakers, never mind if they have never been worn.

 

 

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Travis Wiedower Newbie

Travis Wiedower

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Add me to the list of people who prefer UA over Nike. I was a loyal Nike fan my entire life, but transitioned all my athletic wear to UA over the past year or two. UA stuff is vastly superior IMO.

 

A couple months ago I started paying attention to clothing brands at the gym and UA is definitely more common than Nike (sample size of one gym though so that's not worth much).

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GregS Newbie

GregS

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Two thoughts on this:

 

1) I've purchased online successfully.  A lot of websites have sizing guides.  I will buy shirts and coats online, never pants.  I have athletic legs from working out, they don't usually fit in the modern pants that presumes all men are walking around on muscle-less twigs.

 

The more important point..

 

2) Clothing is TOUGH.  I owned AE for years and followed it about 10 years ago.  I had friends in the industry and tried to keep up with things, it's really hard.  Brands go in and out of style very quickly, too quickly for me.  Success is spotty and isn't long-lived.  You might have a great year or two when designs match with what's popular, but then the year after that a big swing and miss by designers. 

 

I enjoy going to Marshalls and looking at what brands are filling the shelves.  For years Nike and UA stuff was absent, now it's filled.  Same with other "popular" brands.  By the time it hits Marshalls I feel like the wave of popularity has passed.

 

After following clothes for a few years I reached the conclusion it's far outside my circle of competence.  If anything I'd prefer to invest in the retailer verses the brand at this point.

 

I feel like clothes are similar to restaurants.  Popularity moves in waves.  Outback and Applebees were hot in the 90s, now they're second run.  They fill tables, but there is no excitement.  The same applies for Abercrombie etc.

 

On the other hand if you know extremely trendy consumerist type people this might be good.  My sister-in-law is always buying whatever is about to be popular or popular.  Right now she's buying from little boutiques with brands I've never heard of.  It's the whole "hand crafted" thing in small batches.  Not sure there's a way to capitalize on that.

 

I strongly agree with Nate's thoughts on fashion being tough.  I will add that if you are going to buy a fashion stock (or a restaurant) in its growth phase you are going to have to pay a scary looking multiple.  When the multiples start to look reasonable there are probably storm clouds on the horizon.  Anyone who exercises price discipline is going to get in trouble investing in fashion.

 

Turnarounds are possible but they happen MUCH more rarely than most investors hope.

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bizaro86 Proficient

bizaro86

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I'm not sure a mostly male, highly logical driven group of value investors is a good place to go for advice on which brands are hot.

 

I don't think clothing brands will die, but I do accept I have no way of predicting which will succeed. That's practically the definition of outside my circle of competence.

 

I buy dozens of pairs of black socks all the same every few years, so I don't have to think about them, and they all match, which makes laundry faster.

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jmp8822 Contributor

jmp8822

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I'm not sure a mostly male, highly logical driven group of value investors is a good place to go for advice on which brands are hot.

 

Ha! This strikes me as a wise quote.

 

I buy dozens of pairs of black socks all the same every few years, so I don't have to think about them, and they all match, which makes laundry faster.

 

Further proving your point - I have a couple dozen pairs of socks and also white undershirts in their package ready to go for three years from now when I need them. I'm definitely not the guy to ask about fashion - or fashionable equities.

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TorontoRaptorsFan Rookie

TorontoRaptorsFan

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I am still shocked that the most popular brand of shoes is made by Under Armour.

 

It's not. Just remember the Steph Curry white chef shoe debacle. 

 

Fortune August 2016

To be sure, Nike’s business (U.S. sales) is still by far the largest, generating $3.74 billion in sales in the most recent period versus $877.6 million for Adidas and $827 million for Under Armour.

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rkbabang Mentor

rkbabang

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This thread is much better than that who's gonna be president thingy (I think I'll stay here!)

 

If you don't buy UA that is a vote for Nike.  ... Sorry...

 

Hahahahahaha! I'm not gonna rise to the bait (I don't have a dog in that fight anyway...)

 

I don't either.  I look at retailers sometimes, I remember watching The Gap fall, Aeropostale, and now A&F,  I've never ended up buying them, which is probably a good thing.  Can anyone think of an example of a clothing retailer with a similarly massive drop in stock price and business that went on to turn things around and regain their former glory?  I can't .    Sneakers seem to be more stable than apparel though, Nike has been consistently popular for generations.

 

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Ballinvarosig Investors Contributor

Ballinvarosig Investors

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I should also add that Nike continues to build up an extensive patent portfolio which will allow them to stay several steps ahead UA & Adidas.

 

http://www.investors.com/news/a-nike-apple-watch-an-under-armour-baseball-line-patents-hold-secrets/

I am not being smart, but if there's one thing that makes me tremble when coming to evaluate a supposed value investment, it's the words "patent portfolio". Motorola, Nokia, Nortel, a whole bunch of companies that ended up imploding were supposedly value at some point because of their portfolio of patents. It feels that when you start evaluating a company on past achievements, the future really must be bleak.
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