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Premium footwear brands are raising prices and customers are paying
Theme 1: Footwear Companies Demonstrate Pricing Power as Premium Consumers Stay Resilient
The footwear industry is demonstrating remarkable resilience in the face of broader consumer spending concerns. On's CEO Martin Hoffman emphasized that demand remained strong in the third quarter "even as the company hiked certain prices and sold many items at their full retail price." This indicates that affluent consumers in the US continue to indulge in premium footwear products, showing the category is insulated from broader consumer spending slowdowns affecting lower-income households.
The margin expansion story is particularly compelling as companies are not just maintaining margins during price increases but actually expanding them. On raised its full-year margin forecast while absorbing tariff pressures, with management noting that full prices have "easily helped the company digest President Trump's tariffs." This pricing power combined with operational improvements across the sector creates a strong fundamental backdrop for sustained profitability growth.
Stocks that would benefit:
NKE: Nike Inc - The global athletic footwear leader is leveraging its strong brand equity to maintain premium pricing across its Jordan, Air Max, and performance running categories. Despite facing revenue headwinds in 2025, Nike's strategic pivot back to its athletic roots through its "Win Now" actions and "Sport Offense" realignment positions the company to capitalize on the demonstrated consumer willingness to pay higher prices for premium athletic footwear. Nike's repositioning of its digital channels as a premium, full-price destination aligns perfectly with the pricing power thesis, as the company reduces promotional activity to protect brand value and margins in an environment where affluent consumers continue to prioritize quality and performance. Read More →
CROX: Crocs Inc - The company's distinctive comfort-focused footwear has established a unique position in the casual footwear market that enables strong pricing power. Despite a revenue decline of 6.2% in Q3 2025, Crocs demonstrated exceptional profitability with an adjusted operating margin of 20.8% (ahead of guidance), directly supporting the margin expansion thesis. Management's strategic pullback on North America promotions and aggressive inventory cleanup for the HEYDUDE brand are short-term revenue sacrifices designed to strengthen long-term brand health and pricing power. The company's unique comfort technology, customization options, and growing international presence, particularly in Asia, create differentiation that supports premium pricing even in challenging consumer environments. Read More →
Theme 2: Out-of-Home Advertising Gains as Digital Ad Fatigue Drives Budget Reallocation
The fundamental shift reflects growing frustration with digital advertising performance as consumers experience "banner blindness" and tune out digital ads at increasing rates. Privacy regulations and the phasing out of tracking cookies have reduced marketers' ability to target audiences with precision, pushing brands to rediscover out-of-home advertising's unique advantages including its inability to be skipped and independence from cookie-based tracking.
A key development improving the investment case is that out-of-home advertising has become measurable in ways it wasn't before. Brands can now quantify campaign impact through pixel attribution, device-level location data, and metrics like lift in website traffic, foot traffic to retail locations, conversion rates, and branded search volume changes.
This technological advancement positions out-of-home as a viable alternative as digital performance channels face rising acquisition costs. The global out-of-home advertising market is projected to reach $67.96 billion by 2032, growing at a 9.7% compound annual growth rate.
Stocks that would benefit:
CCO: Clear Channel Outdoor Holdings - The company has successfully transformed into a U.S.-focused entity through significant international divestitures, substantially de-risking its portfolio and streamlining operations to capitalize on the shift toward out-of-home advertising. Clear Channel is leveraging its proprietary RADAR platform and new In-Flight Insights solution to drive digital revenue, enhance campaign measurement, and penetrate new advertising verticals—directly addressing marketers' need for measurable, privacy-conscious alternatives to traditional digital channels. The company's aggressive debt reduction and recent $2.05 billion refinancing have significantly extended debt maturities and lowered annualized interest expense, positioning Clear Channel to convert increased advertiser demand into improved free cash flow as brands reallocate budgets toward out-of-home formats. Read More →
LAMR: Lamar Advertising Company - As a leading outdoor advertising REIT with an extensive footprint across billboards, transit, and airport advertising, Lamar is ideally positioned to benefit from the budget reallocation trend. The company delivered solid Q1 2025 results with 1.5% revenue growth underpinned by resilient local demand and strong programmatic performance, demonstrating its ability to capture shifting marketing dollars. Lamar's strategic digital transformation is particularly relevant to the investment thesis, as it allows the company to offer the measurement capabilities and flexibility that brands are seeking as they move away from cookie-dependent digital channels. With a historically strong balance sheet (2.85x net debt/EBITDA) and substantial investment capacity exceeding $1 billion, Lamar has the financial strength to accelerate acquisitions and digital conversions that will further enhance its ability to capture budget shifts from digital to out-of-home advertising. Read More →
Theme 3: Wound Care Device Market Expansion Driven by Chronic Disease Growth and Surgical Volume Recovery
The market expansion is fueled by several structural factors including increasing emphasis on personalized medical treatments, development of cost-effective remedies, rising patient preference toward non-surgical methods, and improvements in healthcare system access. The acute wounds segment is expanding due to rising surgical procedures, trauma cases, and burn injuries, while chronic wounds driven by diabetic foot ulcers, venous leg ulcers, and pressure ulcers are expected to grow at the fastest pace.
The wound care biologics market specifically is projected to grow from $2.06 billion in 2025 to $2.9 billion by 2029 at an 8.9% compound annual growth rate. Strong growth in regenerative medicine, bioengineered skin substitutes, and innovative delivery systems is driving adoption.
The sector benefits from healthcare's position as the strongest performing sector recently, with the broader healthcare category up 7.5% as investors rotate toward fundamentally driven sectors with predictable growth profiles.
Stocks that would benefit:
SYK: Stryker Corporation - Stryker continues to demonstrate robust financial performance, achieving 9.5% organic sales growth and 11.1% adjusted EPS growth in Q3 2025, directly benefiting from increased surgical volumes and wound care demand. The company's strategic focus on innovation, particularly with its Mako SmartRobotics platform and advanced surgical technologies, provides a key competitive advantage in addressing complex surgical wounds. Stryker's recent acquisition of Inari Medical for peripheral vascular applications and its commitment to a second consecutive year of 100 basis points of adjusted operating margin expansion in 2025 position the company to capitalize on both the acute and chronic wound care market growth. The company's full-year 2025 guidance projects organic net sales growth of 9.8% to 10.2%, reflecting confidence in its ability to capture expanding wound care opportunities across hospital and outpatient settings. Read More →
JNJ: Johnson & Johnson - The company's strategic transformation of its portfolio, highlighted by the planned separation of its Orthopaedics business, is sharpening its focus on high-growth, high-innovation segments that include advanced wound care solutions. Johnson & Johnson delivered strong third quarter results in 2025, with operational sales growth of 5.4% worldwide, driven by robust performance in both Innovative Medicine and MedTech divisions that contain its extensive wound care product portfolio. The company's powerful pipeline and differentiated technological platforms in tissue repair and regeneration directly address the growing demand for advanced wound treatment solutions for both acute surgical wounds and chronic conditions. With its diversified business model and disciplined capital allocation strategy, Johnson & Johnson is uniquely positioned to benefit from the projected expansion in both the general wound care market and the high-growth biologics segment through its comprehensive portfolio of advanced dressings, biologics, and wound closure technologies. Read More →
BSX: Boston Scientific Corporation - The company delivered exceptional Q3 2025 financial results, with operational sales growth of 19.4% and organic sales growth of 15.3%, surpassing guidance and demonstrating its ability to capitalize on the expanding wound care market. Boston Scientific's technological differentiators in tissue repair and wound closure solutions provide superior clinical outcomes and procedural efficiency, directly addressing the growing demand for advanced wound management solutions. The company's strategic acquisitions and strong pipeline of new technologies are positioning it to capture significant market share in both the acute surgical wound segment and the chronic wound treatment market. Management has raised its full-year 2025 guidance, projecting approximately 15.5% organic revenue growth, reflecting confidence in the continued expansion of its wound care and tissue repair business lines as surgical volumes recover and chronic disease management becomes increasingly important in healthcare delivery. Read More →
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