Sports apparel retailers have been seeing rising demand for their products as people resume outdoor fitness activities thanks to solid progress on the COVID-19 vaccination front. And despite the resurgence of COVID-19 cases in several countries, we think Nike (NYSE:NKE) and Under Armour (NYSE:UA) (UAA) should continue to benefit from rising demand for their products for both indoor and outdoor fitness activities. But which of these stocks is a better buy now? Read more to find out.Beaverton, Ore.-based Nike, Inc. (NKE) and Under Armour, Inc. (UAA) in Baltimore, Md., are two major companies in the athletic apparel space. NKE designs and markets athletic footwear, apparel, equipment, and accessories for men, women, and children, and sells its products to retail stores worldwide through its own stores, subsidiaries, and distributors. UAA develops, markets, and distributes branded performance apparel, footwear, and accessories made from synthetic microfibers for men, women, and youth worldwide, and sells its products through its wholesale and direct to consumer channels that include brand and factory house stores and e-commerce websites.
Pandemic-driven heightened health awareness has motivated people to workout at home, join gyms and yoga centers, go cycling, or play sports. This has caused a surge in demand for sports apparel and accessories. While the resurgence of COVID-19 cases is leading to the re-imposition of restrictions, solid progress on the vaccination front led to rising outdoor fitness activities this year. The expected continuation of this trend should keep increasing the demand for fitness apparel. The global sports apparel market is expected to grow at a 4.8% CAGR to $267.58 billion by 2028. So, both NKE and UAA should benefit from the industry tailwinds.
But while NKE gained 7.8% over the past month, UAA surged 29.8%. And in terms of their past nine months’ performance, UAA is a clear winner with 58.6% gains versus NKE’s 32.5%. But, which of these stocks is a better pick now? Let’s find out.