Bernstein has identified leading U.S. apparel and specialty retail stocks with the most compelling outlooks, adjusting ratings and price targets to reflect shifting consumer demand and competitive dynamics.
Adidas received an Outperform rating with a price target of €245, equivalent to $132.50, as Bernstein projects a 7% compound annual U.S. sales growth through 2030. The firm expects the company’s U.S. market share to rise from 3.5% to 4.3%, driven by lifestyle momentum, a stronger running portfolio, improved wholesale distribution, and World Cup-related apparel initiatives. Adidas reported record quarterly sales for the second quarter of 2026 but missed earnings per share estimates, though it was upgraded to Outperform by RBC Capital on direct-to-consumer-led revenue growth.
On Holding was also upgraded to Outperform with a $62 price target, supported by the longest growth runway among major brands. Bernstein forecasts a 12% sales CAGR through 2030, lifting U.S. market share from 1.5% to 2.3%. Global sales are projected to expand at a high-teens to low-20% pace, led by expansion in China and Asia. The company is reducing wholesale sell-in for the second and third quarters of 2026 to manage inventory amid a market slowdown, and price targets were lowered by firms including UBS and Telsey following second-quarter results.
Nike retained an Outperform rating with a $68 price target, though JPMorgan downgraded the stock to Underweight citing concerns over the financial impact of strategic decisions. The company forecasts U.S. gross merchandise value growth of 3%-4% CAGR through 2030, with recovery supported by product innovation and renewed wholesale distribution. Nike also announced the resignation of its Chief Accounting Officer, effective September 4, 2026, and faces potential upside if the Jordan brand revives through the 2027–28 innovation pipeline.
Deckers Outdoor was maintained at Market-Perform with a $105 price target, with upside tied to a recovery in Hoka’s U.S. demand and continued growth for Ugg above the broader casual-footwear market. The company reported first-quarter revenue of $1.02 billion, beating consensus estimates, but issued a softer-than-expected outlook for the second quarter. Stifel and Truist Securities lowered their price targets following the guidance.
Lululemon was kept at Market-Perform with a $145 price target, as Bernstein expects the company to continue losing U.S. market share due to product challenges and rising competition from premium brands like Alo and Vuori. U.S. sales are projected to remain broadly flat through 2030, with market share declining from 3.3% to 2.8%. The company is preparing for Heidi O’Neill to assume the CEO role on September 8, 2026, while KeyBanc analysts noted soft U.S. sales trends and UBS lowered its price target amid expectations of a potential reduction in fiscal 2026 earnings guidance.
