Finish Line slashed its earnings forecasts for 2018 on Tuesday, and saw its stock price get whacked.
It wasn’t the only one getting hit.
Nike and Under Armour are both trading lower on Tuesday, as sporting retailers like Finish Line struggle against pressures from online retailers. Nike is down 2.40% to $US52.44 and Under Armour is down 3.30% to $US15.26m which is the lowest the company has traded this year.
Online retailers like Amazon have been driving down the share prices of a number of different industries recently. The company finalised its $US13.7 billion acquisition of Whole Foods on Monday and has already lowered prices, changed some signage and started selling its own products in the stores.
After announcing the price cuts, Amazon erased several billion dollars from grocery store stocks. Sporting retailers saw a similar drop when Nike announced it would give up a longstanding resistance to selling its products on Amazon.
Finish Line’s board adopted a shareholder rights plan on Monday, which would allow shareholders the option to buy more shares of Finish Line if a single investor amasses a 12.5% stake in the company. That type of plan is often called a “poison pill” plan and is designed to protect the company from a hostile takeover.
The company also lowered its earnings estimates from $US1.12-$US1.23 per share to $US0.50-$US0.60 per share. Finish Line fell as much as 31% in premarket trading after the news and is currently trading about 19.4% lower.