LONDON : The trend for low-rise rubber-soled"terrace" sneakers could give Adidas and Puma an advantage over Nike this summer, but may not offset weakening U.S. and Chinese demand.
Puma is likely to benefit less from the trend than Adidas because its terrace range doesn't have as much name recognition, said Adam Cochrane, analyst at Deutsche Bank. But it's certainly an area where the brand can compete. "We believe the U.S. market is now at the heart of the worries for investors in Adidas and Puma," said Robert Schramm-Fuchs, portfolio manager at Janus Henderson, which holds shares in Adidas.
Adidas, led by ex-Puma CEO Bjorn Gulden since the start of the year, said in May it would donate proceeds from Yeezy stock sales to non-governmental organisations including the Anti-Defamation League but has not yet said what share of the proceeds will go to NGOs.