Close

Piper Jaffray Teen Survey Shows Developing Trends from Athleisure to Video Games

April 9, 2014 8:21 AM EDT
Get Alerts VFC Hot Sheet
Price: $14.39 -2.64%

Rating Summary:
    11 Buy, 26 Hold, 3 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 20 | Down: 14 | New: 22
Join SI Premium – FREE

Piper Jaffray released its popular Teen Survey for the Spring of 2014 and issued their thoughts on the implications for fashion, apparel, restaurants, video games, online content and media.

In Global Fashion & Lifestyle Brands, the firm notes that the teen survey supports trade-off between athleisure and denim. "Since Fall 2010 we have seen mindshare in denim move from 20% to 13% while our athleisure group has moved from 2% to 14%". Names that benefit from this trend within the firm's coverage include: VF Corp. (NYSE: VFC), Nike Inc. (NYSE: NKE), Black Diamond (NASDAQ: BDE), Under Armour (NYSE: UA), L Brands (NYSE: LB) and Urban Outfitters, Inc. (NASDAQ: URBN). The firm also notes Coach, Inc. (NYSE: COH) saw its first uptick in mindshare among upper-income females moving to 29% share--up from 26% in Fall. For Deckers (NASDAQ: DECK), the survey showed UGG as the No. 6 among female teens although they did see mindshare slip for both upper- and average-income female. Fossil, Inc. (NASDAQ: FOSL) was most the encouraging Teen Survey takeaway noting mindshare improvements in namesake Fossil brand in both watches and handbags. Michael Kors (NASDAQ: KORS) remained the in-demand accessories brand among teens

In Women's Apparel & Accessories, the firm sees a potential inflection point in 2014. "... we found an early sign of stabilization in spending in the beauty category from our Fall 2013 survey just six months ago. This, coupled with lapping the many woes in the mass sector tied to broad-based destocking at select retail accounts, could bode for a better backdrop in beauty than experienced in 2013." The firm is Neutral on Estee Lauder Cos., Inc. (NYSE: EL), Inter Parfums, Inc. (NASDAQ: IPAR) and Ulta Salon, Cosmetics & Fragrance, Inc. (NASDAQ: ULTA) and Overweight on Coty (NYSE: COTY), L Brands (NYSE: LB) and Target Corp. (NYSE: TGT).

In restaurants, the firm said "Survey work suggests an inflection point, albeit modest, where the gap between clothing less food spend favors the latter for the very first time!" Starbucks (NASDAQ: SBUX) maintained dominant mind share across all relevant categories. Within Hispanic cuisine, Chipotle (NYSE: CMG) edged out Taco Bell (NYSE: YUM). Within American cuisine, Noodles (NASDAQ: NDLS) entered into a top five position for the first time.

In video games, the survey showed interest in next gen consoles among teens is at an all-time high and the firm continues to rate Activision Blizzard, Inc. (NASDAQ: ATVI), Electronic Arts, Inc. (NASDAQ: EA), GameStop Corp. (NYSE: GME) and Take-Two Interactive Softwar (NASDAQ: TTWO) Overweight ratings during the early stages of the next gen console cycle. Also the teen survey results confirm there is a growing market for mobile gaming and with consistent patterns. This is positive for Overweight-rated Glu Mobile (NASDAQ: GLUU) and Neutral-rated Zynga (NASDAQ: ZNGA).

In online content, Netflix (NASDAQ: NFLX) is gaining mindshare and Redbox (NASDAQ: OUTR) is holding steady. "In physical rentals, contrary to many investor expectations, kiosk rentals (primarily from Redbox) are not falling materially as a % of teen rental habits (today or in the next several year)."

In media and entertainment, the firm notes that at home, they see cable subscriptions becoming less essential for teens, with online streaming more critical. Out of home, the survey continues to show IMAX (NASDAQ: IMAX) growing market among teens. Survey of the music/radio listenership highlights growth at both Pandora (NYSE: P) and local radio largely at the cost of MP3s and CDs.

In tech, Apple's (NASDAQ: AAPL) iPhone/iPad remain dominant with interest growing for iWatch. Amazon (NASDAQ: AMZN) is the preferred online shopping experience in our most recent teen survey at 31%, unchanged from our Fall 2013 survey. The teen survey saw 7% of teens ranking eBay (NASDAQ: EBAY) as the preferred online shopping experience, a slight tick down from the Fall 2013 Survey at 8%. The teen survey also showed that Facebook's (NASDAQ: FB) Instagram was the most important social network.

As a result of the survey, the firm downgraded Aeropostale, Inc. (NYSE: ARO) to Underweight, upgraded Hibbett Sports, Inc. (NASDAQ: HIBB) to Overweight. The firm also lowered price targets on American Eagle (NYSE: AEO) (Neutral) to $12, Gap (NYSE: GPS) (Neutral) to $42, and Quiksilver (NYSE: ZQK) (Neutral) to $7. The firm raised price targets on Zumiez (NASDAQ: ZUMZ) (Neutral) to $27 and Coach (NYSE: COH) (Neutral) to $49.



Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In





Related Categories

Analyst Comments

Related Entities

Piper Jaffray