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Why Shares of Foot Locker, Hanesbrands, and Under Armour All Jumped Today

By Rich Duprey – Updated Jun 3, 2020 at 2:47PM

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The markets have been celebrating the early stages of a reopened economy.

What happened

A reopening economy and a better national jobs picture helped boost the confidence of investors who are focusing on business getting back to normal, and not on the continued displacement occurring in large cities as protests and riots break out.

Shares of apparel retailers were rising fast in late-day trading on Wednesday, with Foot Locker (FL 0.06%) up 7%, Hanesbrands (HBI -3.03%) jumping nearly 11%, and Under Armour (UA 1.03%) (UAA 2.24%) almost 9% higher.

So what

Retailers, especially apparel companies, have borne a heavy load under the forced closures brought on by the COVID-19 pandemic because they were deemed nonessential businesses. While rivals like Walmart (WMT -0.27%) and Target (TGT -0.16%) were allowed to stay open because they also sold food, they continued selling apparel, sporting goods, and other merchandise that the specialty retailers were prohibited from remaining open and selling themselves.

Basketball player ready to make a slam dunk

Athletic wear may be helping three apparel retailers soar today. Image source: Getty Images.

Now what

Although the retail giants were given a competitive advantage during the pandemic, many apparel retailers maintained engagement with consumers through their e-commerce platforms. And now with physical storefronts opening up again, there is hope they have weathered the storm and can begin growing again.

It may not be coincidental that these three companies were specifically enjoying strong stock gains today as all have an athletic-wear component to them. Working out and exercise have gained popularity during the lockdown, and it may stick once we're allowed to get back to our normal daily routines. 

Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Under Armour (A Shares) and Under Armour (C Shares). The Motley Fool has a disclosure policy.

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Stocks Mentioned

Under Armour, Inc. Stock Quote
Under Armour, Inc.
UAA
$7.75 (2.24%) $0.17
Foot Locker, Inc. Stock Quote
Foot Locker, Inc.
FL
$33.96 (0.06%) $0.02
Hanesbrands Inc. Stock Quote
Hanesbrands Inc.
HBI
$7.37 (-3.03%) $0.23
Under Armour, Inc. Stock Quote
Under Armour, Inc.
UA
$6.85 (1.03%) $0.07
Walmart Stock Quote
Walmart
WMT
$130.95 (-0.27%) $0.36
Target Corporation Stock Quote
Target Corporation
TGT
$148.47 (-0.16%) $0.24

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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