7 Best Fitness and Gym Stocks to Buy

3. Skechers USA Inc. (NYSE:SKX)

Number of Hedge Fund Holders: 45

Skechers USA Inc. (NYSE:SKX) is an American footwear and apparel company that started by designing utility-style boots and is now the third-largest footwear brand in the US. It also makes accessories like hats, sunglasses, bags, and watches, and has nearly 5300 stores worldwide.

In Q2 2024, the company generated a $2.16 billion revenue, $79.35 million less than analyst expectations. Despite a decline in earnings, this revenue marked a sales record, 7.2% higher than the previous year. Domestic sales increased by 7.7%, while international sales (~60% of the total sales) increased by 6.9%.

The sales record was a surprise given currency fluctuations, supply chain disruptions in European shipments, regulatory issues in India causing limited inventory, and low consumer demand in China. This resulted in the company announcing a $1 billion share repurchase plan.

Skechers USA Inc. (NYSE:SKX) made capital expenditures equating to $47.9 million in Q2, in opening new stores and improving D2C technologies. It opened 25 domestic, 98 international, and 194 distributors, licensees, and franchise stores. 12 domestic, 57 international, and 149 distributor, licensee, and franchise stores were also closed.

Rather than venturing into new consumer segments, the company’s COO, David Weinberg, said that there’s a focus on improving planned and existing product lines in the performance athletic market. The company announced the launch of its first soccer/football product in Europe. It also will be moving its basketball target audience to customers other than professional athletes.

Although Chinese sales were lower-than-expected if it wasn’t for the foreign currency fluctuations, the growth in Chinese sales would have almost doubled compared to the reported figures. This shows the company’s growing optimism for the Chinese market, making this one of the best fitness and gym stocks to buy.