What happened
Shares of On Holding (ONON -0.55%), the footwear company best known for its running shoes, were moving higher today in sympathy with Nike (NKE -0.13%) after the sportswear giant jumped on better-than-expected results in its fiscal first-quarter earnings report.
As a result, On stock was up 6.2% as of 12:31 p.m. ET, while Nike was up by the same percentage.
So what
There was no company-specific news out regarding On Holding, but the results and comments from Nike seemed to be enough to give it a tailwind today.
In fact, the Nike report gave a range of footwear and sports stocks a leg up, as Adidas rose more than 6%, Under Armour was up 4%, and retailers like Dick's Sporting Goods and Foot Locker gained more than 2%.
Oddly, Nike's results weren't all that impressive, but they seemed to help lift the malaise in the discretionary sector as the Swoosh forecast stronger revenue growth in the second half of the year, though revenue rose just 2% in the first quarter.
The company also alluded to weakness in the running business, saying, "We need to drive more meaningful consumer connections among everyday runners and scale these innovations more effectively across the marketplace."
That could be a sign that On is taking market share from Nike.
Now what
While On is still much smaller than Nike, the global leader in sports footwear and apparel, it's growing rapidly, with 52% revenue growth in its most recent quarter -- especially impressive given the challenges in the global economy.
On stock is pricey, trading at a forward P/E of more than 50 based on current estimates, but if the company can maintain its current growth rate, shares could move a lot higher from here.
