JD Sports Fashion PLC rallies as Nike performs better than expected 

JD Sports Fashion PLC (LSE:JD.) shares were in demand as Nike Inc (NYSE:NKE)’s better than expected performance in the US underlined the underway ongoing potential in the trainers, sportswear and athleisure markets.  

Nike said supply chain issues easing in North America and across the EMEA region, as well as excellent performance with its direct-to-consumer apps has boosted the numbers.

READ: Nike’s North American market drives strong second quarter results 

Analysts said Nike’s results and JD’s bounce highlighted the resilience of the trainer and sportwear market. 

Earlier this year,  the FTSE100 member JD reported a huge upward bounce in its interim results, with profit before tax at £364mln, compared to £41.5mln for the same period the previous year.  

Speaking at the time, chief executive Peter Cowgill said he anticipates profit before tax for the end of the year to be at least £750mln. 

He did also mention that footfall in certain countries in the first few weeks of the second half had remained “weak”.  

As brick-and-mortar stores continue to be clouded with uncertainty, brands like Nike and Adidas may push forward with direct-to-consumer sales, skipping out retailers.  

However, Russ Mould, an investment director at AJ Bell believes that bigger stores like JD should have nothing to worry about and remain a key entry into the market for big brands. 

“Key partners who shift a lot of volume like JD remain very much a part of Nike’s route to market. Nike is cutting out the smaller, independent chains and retailers and it is they who are losing out as Nike sells more gear directly to the customer.”

Shares in JD Sports rose 3.6%, while Frasers, which owns Sports Direct, rose by 1.3% to 743p.