Why Shares of Iconix Brand Group Are Crashing Today
Shares of brand management company Iconix Brand Group (NASDAQ: ICON) tumbled on Monday after it disclosed that Wal-Mart would not be renewing the license for DanskinNow, a line of athletic apparel, beyond January 2019. This development forced the company into discussions with its lenders to avoid being out of compliance with some of its debt covenants. Iconix stock was down about 30% at 11:15 a.m. EDT Monday.
Wal-Mart's decision to no longer carry the DanskinNow brand is expected to reduce royalty revenue for the Danskin brand by $15.5 million in 2018. Iconix was quick to point out that other major retailers, including Lord & Taylor, Costco, and TJMaxx, would continue to carry the Danskin brand. The company plans to relaunch and expand the core Danskin brand in other venues.
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Source: Fool.com
