Naked Brand Group Ltd (NASDAQ: NAKD) is flying in the pre-market hours this morning, and for good reason. The company announced news surrounding a newly minted relationship with CVS Health (NYSE: CVS). Of course, the news excited investors who are sending the stock screaming for the top. Today, we’ll talk about:
- The partnership;
- what we’re seeing from NAKD as a result; and
- what we’ll be watching for ahead.
NAKD Announces Partnership With CVS
As mentioned above, Naked Brand Group is having an incredibly strong start to the trading session today after news broke with regard to a partnership. In a press release issued early this morning, the company announced that its wholly-owned subsidiary, Bendon Limited has entered into an agreement with CVS Health. Under the terms of the agreement, Bendon’s master licensed Heidi Klum Intimates Solutions line will be featured in more than 4,000 CVS stores around the United States.
NAKD pointed out that the Heidi Klum Intimates Solutions line features more than 20 essential wardrobe and red-carpet-ready products. These include dressing tape and converters, strapliess braws, backless braws and much, much more. This is a massive win as well. After all, the women’s accessories market in the United States was a $31.9 billion one in 2017 and is only projected to grow. In a statement, Justin Davis-Rice, CEO at NAKD, had the following to offer:
We are pleased to have launched a long-term strategic partnership with CVS Health, which has placed our high-margin Heidi Klum Intimates Solutions line in over 4,000 retail locations across the United States… This move greatly diversifies not only our distribution base, but our product offering as well, providing the Heidi Klum Intimates line representation outside of lingerie, but in a complimentary category. In the first year, we expect significant retail sales from this relationship with a gross margin profile much higher than our traditional product lines. We look forward to further developing our commercial relationship with CVS Health to include other brands and products across our diversified portfolio.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news causes moves. In the case of Naked Brand Group, the news proved to be overwhelmingly positive. After all, its product line will be featured in CVS stores with images of Heidi Klum catching the attention of shoppers. It’s a match made in heaven. So, it comes as no surprise to see that excited investors are sending the stock screaming for the top this morning. Currently (9:10), NAKD is trading at $5.96 per share after a gain of $1.81 per share or 43.61% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on NAKD. In particular, we’re interested in following the revenue surrounding the Heidi Klum product line considering the new agreement. From a larger perspective however, we’re interested in following the story surrounding the company’s consolidation of a fragmented intimate apparel industry. Nonetheless, we’ll continue to follow the news closely and bring it to you as it breaks!
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