|Bid||279.45 x 37900|
|Ask||279.45 x 75600|
|Day's Range||277.05 - 282.80|
|52 Week Range||178.15 - 296.75|
|Beta (3Y Monthly)||0.75|
|PE Ratio (TTM)||28.88|
|Earnings Date||Nov 6, 2019|
|Forward Dividend & Yield||3.35 (1.19%)|
|1y Target Est||198.06|
Nike shares traded higher Monday after analysts at Bank of America Merrill Lynch lift their rating on the stock and boost their price target even as they noted the resurgence of rival Adidas as a 'significant global competitor.'
Houston Rockets general manager Daryl Morey, owner Tilman Fertitta, the NBA, and Rockets star James Harden all apologized to Chinese fans for a tweet that offered support to Hong Kong. Nike stock, exposed to China and the NBA, rose slightly.
California is the first state to pass a law allowing NCAA athletes to hire agents and get paid for use of their name.
Nike Inc's online sales growth and a bullish outlook in China put it on a firm path for years to come and should help it easily ride out rises in U.S. import tariffs on its Chinese-made sneakers, Wall Street analysts said on Wednesday after a strong set of quarterly results. Shares in the world's biggest sportswear maker surged as much as 5% in early trade after the results late on Tuesday showed its margins soaring and sales up 42% through apps and websites it has developed under its Nike Direct strategy. One big questionmark over Nike has been whether it will be hit in its biggest growth market, China, by a backlash against American-branded goods in response to President Donald Trump's rhetoric and successive rounds of import tariffs.
Nike (NYSE:NKE) stock is up over 20% in 2019. But it hasn't been a smooth path for the Beaverton, Oregon company. Nike will report their first-quarter earnings on September 24. NKE stock is trading at a level of resistance it has failed to break twice this year.Source: Shutterstock Will the third time be the charm? There are several reasons to believe it will. And a positive earnings report is just one of them. Nike Expects to Post Positive EarningsIn June, Nike reported positive top-line sales but a negative earnings per share. This was the first miss by the company in many years. The stock had already climbed nearly 20% at that point, and many investors took the report as an opportunity to take profits.InvestorPlace - Stock Market News, Stock Advice & Trading TipsI believe in the mantra that good companies don't suddenly become bad. Nike is experiencing increased competition and a changing retail landscape. But the company is showing an incredible ability to adapt and is still delivering value to shareholders by way of a small dividend and a proportionate amount of share buybacks. * 7 Triple-'F' Rated Stocks to Leave on the Shelf This leads me to believe that if Nike posts positive earnings (as expected), there is no reason to believe the stock should not get a lift going into the holiday season despite an increasingly competitive landscape. Nike Outsells its CompetitionThere's no question that both Adidas (OTCMKTS:ADDYY) stock which is up nearly 50% and Lululemon (NASDAQ:LULU) stock which is up over 30% are crushing Nike stock in 2019. But a closer look shows that Nike still is beating both regarding a fundamental metric: sales.Nike is forecasting full-year revenue of $39.1 billion as opposed to $26.43 billion for Adidas and $3.68 billion for Lululemon. In fairness, Lululemon is a niche player on the high end of the "athleisure" market. but the Vancouver company's dominance in the marketplace is a threat to Nike's future growth.And it's a threat Nike is taking seriously. The company continues to expand its line of women's athleisure wear. One example of this commitment was the company's "high performance kits" that they introduced for this year's Women's World Cup. Nike also has introduced their own yoga collection that includes both men's and women's offerings.Adidas competes with Nike directly in the sneaker game. But while both companies have exposure to China that is causing concern, Adidas is headquartered in Germany, a country that is either headed for or possibly already in a recession. Nike is Exhibiting a Start-Up MentalityI'm old enough to remember when Nike was a start-up. But despite becoming a blue-chip, dividend-paying stock, Nike has continued to adapt to a changing retail landscape and consumer. One of its latest ventures is the Nike House of Innovation 000 in New York City. The store is an extension of Nike's growth in the digital space. Mobile scan and pay, interactive kiosks, and displays that reflect local trends are all a staple of the Fifth Avenue store.Nike is also demonstrating a commitment to an enhanced in-store experience in its partnership with Foot Locker (NYSE:FL). As other shoe brands are fleeing the brick-and-mortar model, Nike is showing that in-store can work if the experience is right.But that doesn't mean that Nike lacks a strong digital presence. It has initiated a partnership that allows the company to sell directly on Amazon. And the company has also partnered with Walmart's (NYSE:WMT) urban brand, Jet.com. The store saw digital sales growth of over 40% in 2018 which was well ahead of the retail sector. And Nike's mobile demand accounted for over half of its e-commerce sales last year. What's Next for NKE Stock?Nike stock has been right around this $90 level twice before this year. In June, NKE plunged as the company posted their first decline in EPS in a long time. However, the decline was short-lived and by early July, NKE stock was back near present levels. Once again, it failed to sustain the momentum.Is the third time the charm? I think it will be. NKE stock is not inexpensive. It currently trades for over 30 times its fiscal 2020 consensus EPS.However, analysts are high on Nike stock. And the technical indicators for Nike show a stock that has investors looking for a catalyst. A positive earnings report should provide just that spark.As of this writing, Chris Markoch did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Triple-'F' Rated Stocks to Leave on the Shelf * 10 Excellent Stocks to Watch for 2020 and Beyond * 7 Consumer Stocks to Buy in an Uncertain Market The post Nike Stock Just Needs a Little Earnings Momentum appeared first on InvestorPlace.
For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to...
(Bloomberg Opinion) -- The California Assembly has 61 Democrats and 18 Republicans. The California Senate has 29 Democrats and 11 Republicans. As with everywhere else in the U.S., the two parties are divided on most issues, from regulating the gig economy to limiting gun purchases. But there is one issue on which both Democrats and Republicans in California are aligned: paying, at long last, college athletes.(5)On Monday, a bill that would override the “amateurism” rules of the National Collegiate Athletic Association and give athletes at the major California universities the right to capitalize financially on their name, likeness and image passed the Assembly by a vote of 72-0. Then, on Wednesday, the state senate passed the Fair Pay to Play Act, which allows athletes to market themselves for things like personal sponsorships, endorsements, and video-game licensing, by a margin of 39-0. Not a single dissent! I still can’t quite believe it.There have always been a few lonely voices calling for the athletes who play college football and basketball -- the revenue sports, as they’re called -- to be paid. One such person, believe it or not, was Walter Byers, the man who ran the NCAA from 1951 to 1987. In retirement, he turned against the amateurism rules he had long enforced, describing them (correctly) as the means by which the college sports cartel avoided paying its labor force.Another was Sonny Vaccaro, who did as much as anyone to commercialize college sports; he marketed basketball sneakers for Nike, Adidas and Reebok before quitting to fight the NCAA. His beef was that it was wrong for everyone involved in college sports to be making money except the players.But until recently, those voices went largely unheard. Most people -- even ardent fans -- ignored the question of whether college athletes were being exploited. If they got angry at the NCAA it wasn’t because of its cartel-like nature, or the harshness of its bylaws. It was usually because the school they cheered for was being punished “unfairly” for violating some rule or other. (Fans always think their university is being punished unfairly.)Then, in 2009, the former UCLA basketball star, Ed O’Bannon, sued the NCAA after seeing his avatar in a video game -- and realized that the video game company was paying the NCAA for the rights to his image instead of him. Two years later, Taylor Branch wrote his ground-breaking article in The Atlantic, “The Shame of College Sports.” It included this memorable line: “The tragedy at the heart of college sports is not that some college athlete are getting paid” -- under the table, he meant -- “but that more of them are not.”The coastal elites started paying attention.I jumped in a few month later, after doing some research that convinced me that the exploitation of basketball and football players at big-time college programs was unconscionable. “Frontline” did a documentary about exploited athletes, “Money and March Madness.” Sports columnists began regularly taking the NCAA to task. The issue was rising to the surface.When the O’Bannon case went to trial in June 2014, it was widely covered in the media and the NCAA did not come off well. (Charles Pierce, writing in Grantland, described the NCAA’s arguments as “the threadbare piety in which it wraps its heedless commercialism.”) It ended with both the trial judge and the appeals court agreeing that the NCAA’s rules outlining and defining amateur athletics amounted to an antitrust violation. But sadly, the appeals court bought the NCAA’s argument that amateurism was what differentiated college sports from professional sports, so the remedies it allowed did nothing to overturn the status quo.The unanimous vote in favor of the Fair Pay to Play Act shows just how far we’ve come since then. It’s a little like marriage equality. For years, public opinion moved an inch at a time -- and then all at once, it seemed, two-thirds of the country supported it.California State Senator Nancy Skinner, the sponsor of the bill, is a perfect example of how people have come around. In November 2015, she heard the economist Andy Schwarz speak at a Rotary Club meeting in Oakland. Schwarz has been fighting the NCAA since 2004; he was one of the people who helped gin up the O’Bannon case. He can be absolutely withering about the NCAA cartel.As Skinner listened to him, she later told the New York Times:All of a sudden the light bulb went off. Rather than being the bystander going, “Gosh this is so unfair, how do these people get away with this?” I’m like, “Hey, if I’m in the Senate, can the state do something about it?”She also framed the issue in exactly the way critics like Schwarz and Vaccaro have all these years: “I don’t know of any other industry that can rely on a large set of people’s talent for which they deny them any earnings and all compensation.”The bill embraces what’s called the Olympic model. Olympic athletes aren’t paid directly for competing, but they are allowed to accept money from endorsements, sponsorships, autographs, and the like. Skinner’s bill gives athletes at the big California universities the same ability, overriding NCAA bylaws that forbid such payments. It’s not everything. Athletes who lack the star power to reap endorsement money will still be unable to capture their economic value to a university. But it’s a start.Or perhaps I should say, it might be a start. You see, assuming the bill is signed into law by Governor Gavin Newsom, it won’t take effect until 2023. That would give the NCAA and the affected California universities plenty of time to sue to have it overturned.Absurdly, the NCAA says that the bill is “unconstitutional,” because it “would remove that essential element of fairness and equal treatment that forms the bedrock of college sports.” In a letter to Newsom, the NCAA also claimed that if California athletes are allowed “an unrestricted name, image and likeness scheme” it will put every other Division 1 university at a disadvantage.I’m not so sure about that. For one thing, Schwarz has co-founded the Historical Basketball League, an eight team league that will pay college-age basketball players upwards of $150,000 a year before they enter the pros. Its first year of operation will be 2020, and if it’s even mildly successful in drawing top high school players away from college basketball it will put enormous pressure on the NCAA’s amateurism model.For another thing, California is unlikely to be the only state to pass a law similar to the Fair Pay to Play Act. Earlier this year, Washington State considered similar legislation, which will likely go forward now that California has led the way. I imagine by 2023 ten or 15 states might have their own version of the law – at which point the move to give athletes their economic rights, the same rights as any other American, could turn into a stampede.Yes, the winds of change are blowing. What the California bill suggests most of all is that the days when the NCAA could hold back progress are finally coming to an end.(1) The more common term, of course, is “student athlete,” but I avoid it at all costs. It is an Orwellian phrase, devised by the NCAA in the 1950s to avoid having to pay workers’ compensation to injured football players.To contact the author of this story: Joe Nocera at email@example.comTo contact the editor responsible for this story: Timothy L. O'Brien at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Joe Nocera is a Bloomberg Opinion columnist covering business. He has written business columns for Esquire, GQ and the New York Times, and is the former editorial director of Fortune. His latest project is the Bloomberg-Wondery podcast "The Shrink Next Door."For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
(Bloomberg) -- Apple Inc. and manufacturing partner Foxconn violated a Chinese labor rule by using too many temporary staff in the world’s largest iPhone factory, the companies confirmed following a report that also alleged harsh working conditions.The claims came from China Labor Watch, which issued the report ahead of an Apple event on Tuesday to announce new iPhones. The non-profit advocacy group investigates conditions in Chinese factories, and says it has uncovered other alleged labor rights violations by Apple partners in the past.For its latest report, CLW said undercover investigators worked in Foxconn’s Zhengzhou plant in China, including one who was employed there for four years. One of the main findings: Temporary staff, known as dispatch workers, made up about 50% the workforce in August. Chinese labor law stipulates a maximum of 10%, CLW noted.Apple said that, after conducting an investigation, it found the “percentage of dispatch workers exceeded our standards” and that it is “working closely with Foxconn to resolve this issue.” It added that when it finds issues, it works with suppliers to “take immediate corrective action.” Foxconn Technology Group also confirmed the dispatch worker violation following an operational review.Apple’s supply chain has faced criticism over poor labor standards for years, and the company has pushed manufacturing partners to improve factory conditions or risk losing business. However, suppliers and assemblers are always trying to churn out more handsets. Foxconn, officially known as Hon Hai Precision Industry Co., hires tens of thousands of temporary workers to ramp up production and meet iPhone demand during the key holiday season each year.“Our recent findings on working conditions at Zhengzhou Foxconn highlights several issues which are in violation of Apple’s own code of conduct,” CLW wrote in its report. “Apple has the responsibility and capacity to make fundamental improvements to the working conditions along its supply chain, however, Apple is now transferring costs from the trade war through their suppliers to workers and profiting from the exploitation of Chinese workers.”CLW was founded in 2000 as a 501(c)(3) organization to investigate Chinese factories that make toys, shoes, electronics and other products for some of the world’s largest multinational companies. It has an office in New York City and one in Shenzhen that offers a hotline for factory workers in China, according to its website.While its report said 55% of factory staff were dispatch workers in 2018, and about 50% in August, this included student interns. Because many of these students returned to school at the end of August, that number is now closer to 30%, which is still a violation, according to CLW.“We believe everyone in our supply chain should be treated with dignity and respect,” Apple also said in a statement. “To make sure our high standards are being adhered to, we have robust management systems in place beginning with training on workplace rights, on-site worker interviews, anonymous grievance channels and ongoing audits.”Foxconn said it found “evidence that the use of dispatch workers and the number of hours of overtime work carried out by employees, which we have confirmed was always voluntary, was not consistent with company guidelines.”It added that its “work to address the issues identified in our Zhengzhou facility continues and we will closely monitor the situation. We will not hesitate to take any additional steps that might be required to meet the high standards we set for our operations.”Apple releases an annual supplier responsibility report that details working conditions in its supply chain. In its latest report, Apple said it conducted 44,000 interviews with supplier employees last year to check if they were properly trained and knew how to voice concerns, while taking new steps to prevent forced labor.In late 2017, Apple found Foxconn had employed high school students who worked illegal overtime to assemble the iPhone X. Apple sent specialists to the facility to work with management on systems that ensured appropriate standards were followed.Foxconn is the largest of a coterie of gadget assemblers that produce most of the world’s consumer electronics from sprawling Chinese bases. Typically operating on wafer-thin margins, they employ millions of mostly migrant and temporary workers because activity tends to wax and wane with shopping seasons and fluctuations in demand.Dispatch workers don’t receive benefits that full-time employees get, such as paid sick leave, paid vacations and social insurance, which provides medical, unemployment and pension coverage, according to CLW. While base wages can be higher for dispatch workers, they are paid by third-party firms on a short-term basis and are not employed directly by Foxconn, CLW says. Dispatch workers can become official factory workers after an initial three-month period, according to the group’s report.Last month, Foxconn said it fired two executives at one of its Chinese plants after another CLW investigation found the company was relying heavily on temporary workers and teenage interns to assemble Amazon.com Inc. Echo speakers. Foxconn reviewed the Hengyang facility and found the proportion of contract workers and student interns had on occasion exceeded legal thresholds, and that some interns had been allowed to work overtime or nights.The group, which also monitors conditions in myriad industries from apparel to retail, has run reports in the past on suppliers to the likes of Nike Inc. and Adidas AG and, recently, probed a factory that manufactured Ivanka Trump-branded shoes.Apple and Foxconn seek to produce about 12,000 iPhones per shift at the Zhengzhou factory, CLW’s latest report found. Last year’s iPhone XS models were more complex to build than the iPhone X, requiring more workers, the group also said.According to emails seen by Bloomberg, Apple told CLW in August that it was looking into the findings and had questions about the report. The company sent an investigator to the factory and met with Foxconn officials to discuss the heavy use of dispatch workers, but Apple and Foxconn are still allowing the activity despite violating the 10% standard, CLW said.The CLW report also detailed other findings, such as:During peak production periods, resignations are not approved.Some dispatch workers have not received promised bonuses.Student workers do overtime during peak production season, even though regulations on student internships prohibit this.Some workers put in at least 100 overtime hours each month, during busy production periods. Chinese labor law limits monthly overtime to 36 hours.Workers must get approval to not do overtime. If requests are denied and staff still choose not to work overtime, they are admonished by managers and miss out on future overtime opportunities.Workers sometimes have to stay at the factory for unpaid meetings at night.The factory doesn’t provide adequate protective equipment for staff.Work injuries are not reported by the factory, and verbal abuse is common there.While overtime is allegedly often required, most workers want to work overtime to make more money, according to an anonymous diary written by a CLW investigator in the factory.“We looked into the claims by China Labor Watch and most of the allegations are false,” Apple said. “We have confirmed all workers are being compensated appropriately, including any overtime wages and bonuses, all overtime work was voluntary and there was no evidence of forced labor.”Apple added that less than 1% of workers were student workers, and that a small percentage of them voluntarily worked overtime or night shifts. Apple and Foxconn both said this issue has been corrected.Most factory workers are paid about 4,000 yuan ($562) a month, one CLW investigator found. After taxes and mandatory fees, they get roughly 3,000 yuan a month, according to the CLW report.China’s per capita disposable income was 28,228 yuan in 2018, or 2,352 yuan a month, China Daily reported earlier this year, citing government data.(Updates with detail on the group from the 7th paragraph)\--With assistance from Debby Wu.To contact the reporter on this story: Mark Gurman in San Francisco at email@example.comTo contact the editors responsible for this story: Tom Giles at firstname.lastname@example.org, Alistair Barr, Edwin ChanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
It's only natural that many investors, especially those who are new to the game, prefer to buy shares in 'sexy' stocks...
Reducing virgin plastic waste has been one of the most popular corporate sustainability efforts made by public companies in recent years. Adidas AG (ADR) (OTC: ADDYY) has long been recognized as a leader in corporate sustainability and has announced its plan to eliminate virgin plastic use from its products by 2024. The company also partnered with Parley for the Oceans in 2015, an environmental organization that raises awareness for the beauty and fragility of the oceans and enacts strategies to end their destruction.
For many, the main point of investing in the stock market is to achieve spectacular returns. While the best companies...
(Bloomberg) -- To satisfy regulators, YouTube officials are finalizing plans to end “targeted” advertisements on videos kids are likely to watch, according to three people familiar with the discussion. The move could immediately dent ad sales for the video giant -- though not nearly as much as other proposals on the table.The Federal Trade Commission is looking into whether YouTube breached the Children’s Online Privacy Act (COPPA). The agency reached a settlement with YouTube, but has not released the terms. It is not clear if YouTube’s changes to ad targeting are a result of the settlement. The plans could still change, said the people, who asked not to be identified citing an open investigation.A spokeswoman for YouTube declined to comment. A spokeswoman for the FTC declined to comment. The agency is expected to levy a multimillion-dollar fine.Since targeted, or “behavioral” ads, rely on collecting information about the viewer, COPPA effectively bars companies from serving them to children under 13 without parental permission. These commercial messages that rely on mountains of digital data, such as web-browsing cookies, are integral to the business of Alphabet Inc.’s Google, YouTube’s owner.YouTube has long maintained that its primary site is not for children. (The company says kids should use YouTube Kids app, which does not use targeted ads.) But nursery rhymes and cartoon videos on the main site have billions of views. The platform’s many issues with children’s content-- horrific imagery, problems that led to disabling comments-- have troubled its video creators, worried parents and empowered rivals.Getting rid of targeted ads on children’s content could hit Google’s bottom line -- but this solution would be far less expensive than other potential remedies that aim to placate regulators.In April 2018, a slew of consumer groups complained to the FTC that YouTube regularly collected information about minors to use in targeted advertising. Once the FTC picked up the case, these groups suggested that the agency force YouTube to move all kids’ videos to its designated app for children, YouTube Kids. Joseph Simons, the FTC chairman, has floated another idea. He asked the complainants in a July 1 call whether they would be content with YouTube disabling ads on these videos, Bloomberg News reported earlier.YouTube’s new proposal is even less drastic.Right now, YouTube sells two different types of video ads, broadly speaking. One simply pairs the context of a video with a commercial message. So, a YouTube clip about basketball might have an ad from Adidas. The other type uses an array of digital signals. With these ads, marketers can reach viewers in a demographic group, such as homeowners or new parents, based on Google’s vast data troves -- websites people visit, searches they make and so on.YouTube doesn’t disclose ad sales or prices, but most digital ads are more lucrative when paired with targeting data. Other tech giants, such as Apple Inc., have tried to cull back data-collecting tools in services that kids use.Loup Ventures, a research firm, estimates YouTube’s revenue from children’s media between $500 million and $750 million a year. Paring back targeted ads would dent that revenue, although Google has the ability to make its contextual ads more compelling to mitigate the damage, said Doug Clinton, a Loup Ventures analyst. He pegged the potential impact of YouTube curbing targeted ads at 10% of its overall intake from kids’ videos-- so about $50 million. “That would be the worse case, in my mind,” he said.It’s not clear how YouTube would deliver this targeting ban with the thousands of video channels with whom it splits ad sales. It’s also unclear how YouTube would define which videos are “directed at children” and which aren’t.One certainty: This proposal is unlikely to please complainants. In a July letter to the FTC, the groups argued that bans on YouTube ad targeting would be difficult to enforce. Removing the feature from select kids’ videos doesn’t guarantee that YouTube stops tracking web habits if children watch other clips, said Josh Golin from Campaign for Commercial-Free Childhood, a complainant. “Is Google still going to be collecting all the data and creating marketing profiles?” he said. “That wouldn’t be satisfactory either.”Jeff Chester, executive director of Center for Digital Democracy, another complainant, said that if the FTC settlement only forced YouTube to curb targeting, his group would likely challenge the decision.(Updates with other companies in 10th paragraph.)\--With assistance from Ben Brody and Lucas Shaw.To contact the reporter on this story: Mark Bergen in San Francisco at email@example.comTo contact the editors responsible for this story: Jillian Ward at firstname.lastname@example.org, Emily Biuso, Andrew PollackFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Adidas celebrated its 70th anniversary on Friday with appearances at its Bavaria campus by sponsored athletes such as tennis veteran Stan Smith and German soccer legend Philipp Lahm, as well as celebrity partners like Pharrell Williams. Adidas opened a new building resembling a football stadium and housing 2,000 employees at its sprawling site outside the town of Herzogenaurach. "This puts us in a perfect position for the future, continuing on our international growth track," Chief Executive officer Kasper Rorsted told employees.
(Bloomberg Opinion) -- A year ago, Mike Ashley was being hailed as a possible savior of Britain’s rapidly depopulating shopping districts. Now, after the comically delayed announcement of his company’s annual results last month, the colorful sportswear billionaire looks like just any other struggling retailer.It’s 12 months since his Sports Direct International Plc struck a deal to acquire the ailing department store chain House of Fraser. Ashley, who had long stalked the business, now regrets the move. The acquired business has had an instantly negative effect on the wider group, which showed up starkly in its results statement.House of Fraser’s poor trading shouldn’t really have surprised anyone after years of chronic under-investment. Add in supplier problems and cautious consumers and it racked up more than 50 million pounds ($61 million) of losses from August to the end of Sports Direct’s financial year on April 28. Ashley is even losing money on House of Fraser stores where he’s paying no rent.While this hasn’t turned out to be the “Harrods of the high street” of Ashley’s dreams, he did at least manage to limit some of his financial exposure. Sports Direct paid 90 million pounds for the assets, and invested a similar amount in working capital, but it did pick up House of Fraser’s shop stock too. That might have been worth more than the purchase price.Ashley was never likely to keep all of House of Fraser’s stores. He’s still planning more upmarket outlets in Glasgow, Belfast, Liverpool and Newcastle. He’s keen too to sell more of the designer labels that have made his Flannels chain of smaller stores a hit, so having bigger flagship department stores will help. Many House of Frasers will probably be closed though.Ashley, who’s been targeted by U.K. politicians before because of his employment practices, can legitimately say he’s tried to save jobs. But turning around a chain with “terminal” problems (his words) was just too difficult. While he will no doubt be criticized, stemming financial losses and making Frasers – the new name for the high-end chain – smaller and higher quality make sense.Nevertheless, even this more limited ambition is a huge challenge, and his company has problems elsewhere. Its strategy of improving the attractiveness of its core Sports Direct stores – known for their “pile ‘em high and sell ‘em cheap” approach – hasn’t gained traction yet. Nike and Adidas are still reluctant to supply it with the latest sneaker models.An unexpected 674 million euro ( $754 million) tax bill – which caused that embarrassing delay in the results – was another unwelcome surprise and smacks of a group that’s spinning out of control. Indeed, Sports Direct’s management has been stretched thin by a string of Ashley investments that have also included Game Digital, a video game retailer, and Jack Wills, a struggling apparel supplier to affluent teens. This has been compounded by the departure of key executives, including the head of retail Karen Byers.In the current climate, Ashley’s strategy of having lots of high street property, in which he can drop different brands (which he usually buys on the cheap) appears sensible. In a distressed market, why not try to take advantage of the misery elsewhere? He might still take a fresh tilt at Debenhams, another British department store chain that’s now owned by a group of lenders and hedge funds.But Sports Direct appears to be fighting fires on too many fronts. Investors, who have pushed the shares down by 42% in a year, are right to be skeptical. Ashley has to win over the big brands for his Sports Direct chain, and some luxury names at House of Fraser. Given the history of his stores, that won’t be easy.While net debt is forecast to remain an undemanding 1.5 times in the current financial year, according to analysts, and the Sports Direct chain still generates cash, upgrading stores and making strategic investments isn’t cheap. As I’ve argued before, Sports Direct would be better off as a private company. Ashley, who owns 62% of the shares, says he has no intention of doing this because without outside shareholders he would be “uncontrollable.” But it’s hardly as if he’s been reined in by the demands of being a listed company.As it is, minority investors have little option than to hope he makes the right choices from here. There may yet be method in the Ashley madness, but he needs to prove that the last year wasn’t all just folly.To contact the author of this story: Andrea Felsted at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.