Work + Money

I was watching the Olympic trials for the U.S. swimming team, and I noticed that nearly all the competitors, male and female alike, were wearing a new kind of Speedo suit called an LZR Racer that makes them look like dolphins, very sleek and streamlined. As an investor always looking for trends, I went to the Speedo Web site to check out the suits, which are super high-tech. I called Speedo and found out that you can't actually buy them yet (unless you're an Olympic contender!), but they can be pre-ordered for delivery in October. They're quite expensive, $475 for the women's full-body suit and $550 for the men's. On the Web site, you can watch a video of international journalists trying out the suits and ooh-ing and ah-ing over them. One of them says the suit makes him feel like a torpedo!

Speedo, as it happens, is part of a company called Warnaco Group (stock ticker WRC), which also makes and/or distributes "intimate" apparel and sportswear, including the labels of Calvin Klein, Chaps, Warner's and Olga. Several analysts like the stock, and it has a target price (the price it's expected to reach) of between $55 and $65. Its sales dipped in the last quarter, but they are expected to pick up later in the year. What I'm wondering is if the Speedo suits will give them an extra boost, even though they would be such a small part of this company's large holdings. The suits give the swimmers an edge, so maybe the stock?

Even though few of us who just do some laps in our backyard or local pool will spend so much on a bodysuit, Speedo has already gotten a boost in their sales in the U.S. that their executives attribute to the "halo" created by the LZR. Speedo's market share in performance swimwear this year through June 14th was up seven percent, at 61%, while Nike fell nine points to 11 percent, according to SportsOneSource, a market research firm.

I was wondering if anyone else out there in the Shine community had noticed the suits and would actually buy one, although maybe I should wait until the Olympics and ask the question then, when the whole world has a chance to see the suits. But then the stock might already have gotten the boost I think it might if the trend catches on.
(This is not a recommendation to buy or sell any stocks, just a way to work on trend-watching and investing skills.)