Tech stocks have been on the rise, but many investors are questioning their valuations and looking beyond tech for investment opportunities. This has led to a search for alternative growth opportunities outside the realm of technology. Fortunately, growth exists beyond artificial intelligence and the latest Apple (NASDAQ:AAPL) gadgets. In fact, the unassuming sport of pickleball is experiencing a remarkable surge in popularity, both recreationally and professionally, and it’s creating investor excitement for certain companies.
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Pickleball’s Meteoric Rise
Pickleball is a paddle sport that combines elements of badminton, tennis, and ping-pong. Its easy-to-learn rules and engaging gameplay have fueled rapid growth, with the number of unique participants skyrocketing by 673% from January 2022 to June 2023, according to the LTP Data & Insights report. This surge in participation translates to a booming business opportunity for companies that cater to the pickleball market.
Life Time Group is Pickleball Positive
Life Time Group, a high-end gym operator (NYSE:LTH), has embraced the pickleball phenomenon. Recognizing the sport’s potential, the company has incorporated pickleball courts into its existing North American footprint, with plans for even more courts in upcoming developments.
LTH’s commitment extends beyond facilities. Life Time offers pickleball training programs, social events, and a vibrant pickleball community within their gyms. This comprehensive approach positions LTH to capitalize on the ongoing pickleball craze.
Skechers, Without Footwear, There’s No Game
Pickleball requires specific footwear that combines elements of tennis shoes and court shoes. Skechers USA Inc. (NYSE:SKX) is a company that has responded to this demand with its line of high-performance pickleball shoes. In their Q2 2023 earnings report, SKX attributed a portion of their record sales and profit surge to strong demand for comfortable lifestyle and athletic footwear, including their pickleball shoes. This suggests that SKX may be well-positioned to benefit from the growing pickleball market.
The TipRanks Comparison Results tool demonstrates that both Life Time Fitness and Skechers hold an analyst consensus of Strong Buy.
The Broader Pickleball Investment Universe
While LTH and SKX are two clear beneficiaries of the pickleball boom, there are other potential investment opportunities. Pickleball equipment manufacturers, apparel companies, and even tournament organizers could see a rise in their fortunes as the sport continues to grow. Investors with a keen eye for spotting trends might uncover additional opportunities within this burgeoning industry.
Key Takeaway
Tech may be king for now, but investors looking for alternative growth opportunities shouldn’t overlook unexpected areas like pickleball. The sport’s meteoric rise has created a lucrative market for companies that cater to its needs. By carefully researching companies like LTH and SKX, investors may uncover a promising investment opportunity.
