One Winner, One Loser

Jul 04, 2021

Can You Pick the Winner?

As consumer behaviors change in a reopened society, it’s time to see which companies are benefitting and which companies are struggling.

Last week, the consumer data was screaming at us.

On one hand, we have a company that specializes in comfortable, celebrity-touted footwear that critics love to hate.

On the other hand, we have a company that specializes in adventuring, touting off-road vehicles from snowmobiles, to scooters, to three-wheelers with other-worldly design elements.

By analyzing macro trends and consumer demand, a clear Reopening Winner and Loser have emerged… and no, we aren’t biased — the data tells all.

Reopening Winner: Crocs (CROX) Demand Rising into Critical Back-to-School Season

Crocs Purchase Intent is outperforming peers, with Purchase Intent rising +24% QoQ.

New product drops continue to drive demand, including collaborations with Balenciaga, Diplo, and Disney/PIXAR’s Lightning McQueen.

We expect demand growth to continue, especially as students (and teachers) return to school.

Last year’s back-to-school shopping peak was about 64% lower versus 2019… so pent-up demand is looming.

And what kid doesn’t want a pair of these?

Reopening Loser: Polaris (PII) Demand Dips Below Pre-Pandemic Levels

LikeFolio touted Polaris’ strength last summer as consumers craved a means to get out of the house.

We confirmed this strength again after demand mentions revealed an incredibly strong holiday season.

Shares have traded +50% higher since our first note, currently +39% since last July.

Now, consumer demand for new Polaris vehicles is waning.

Purchase Intent has decreased: -43% YoY, and -35% versus 2019.

Even though we are recording an expected seasonal ramp, demand remains much lower versus the prior two years.

In addition, ORV (off-road vehicle) usage mention growth has normalized: -2% YoY.

As stimulus checks dry up and entertainment options reopen, can PII growth continue at its recent pace? We’re not sure it can.

And that gives us an incredible edge.

Not only do we have confidence that Crocs’ dominance is continuing, but we have plenty of warning that Polaris may upset the market next time it reports.

Two totally different stories, but the same powerful trading advantage.

That’s what we’re all about.

Andy Swan,
Founder, LikeFolio