3 Best Stocks for Investing in Footwear

For many people, to "invest" in footwear usually means splurging on a great new pair of shoes. But make no mistake: That is not the only way you can put your money to work in footwear. With tens of billions of dollars at stake in the global footwear market, investors can choose from dozens of publicly traded companies in an effort to capitalize on this industry.

In no particular order, I believe these are the best three stocks for investing in footwear.

That iconic swooshFirst up is Nike , which last quarter alone generated a whopping $4.57 billion in Nike brand footwear sales, good for over 60% of total revenue. Despite its already enormous size, that was an 8% increase over the same year-ago period, slightly outpacing overall 7% growth even as the company faced significant foreign currency headwinds. Excluding currencies, Nike brand footwear sales would have climbed 14%.

Source: Nike

Nike also owns Converse, which grew revenue an even more impressive 28% (33% excluding currencies) to $538 million over the same period. Thanks to bothrecent legal action to stem copycat brands and heavy "demand creation" and infrastructure investments from Nike, Converse should be able to continue its outsized growth.

Nike earnings have consistently outpaced its modest overall growth, with net income last quarter climbing 16% to $791 million, while net income per share rose 19% to $0.89. For the latter, investors can thank Nike's fortress-like balance sheet, which has enabled it to continuously buy back shares under an $8 billion share repurchase plan authorized in late 2012. Nike still has around around $2.7 billion of that authorization remaining, and it ended the quarter with cash and investments of roughly $5.4 billion.

As it stands, however, Nike stock is currently trading near all-time highs on the heels of those solid results. But with an annual dividend yield of roughly 1.1% and shares trading around 25 times expected 2015 earnings, that is a reasonable premium for long-term investors looking to try on this top notch business.

The up-and-comerNext is Under Armour , whose founder and CEO, Kevin Plank, regularly takes shots at Nike by insisting that his company continues "to hunt down becoming the No. 1 athletic-footwear brand in the world."

Source: Under Armour

Lucky for us, Under Armour still has a long way to go before it achieves that goal. In 2014, footwear revenue climbed 44% for the year to "just" $431 million. We should also keep in mind that Under Armour has barely scratched the surface globally, as international sales comprised only 9% of total revenue in 2014 -- and that is after growing 96% to $260 million for the year.

Considering the massive size of the Nike footwear business, it is no surprise that Plank boldly stated a few months ago, "We ultimately believe Footwear should be as big, if not bigger, than our apparel business."

Under Armour stock also arguably reflects that growth, with shares currently trading at 55 times expected earnings and 5.5 times trailing-12-month sales. But as a longtime Under Armour shareholder, I have learned not to underestimate the company's ability to grow into its seemingly steep valuations.

A fashionable approachFinally, if you prefer something dressier, consider playing the footwear space with another iconic brand: Coach .

Yes, Coach is primarily known for its stylish handbags. But earlier this year, Coachstepped out on a limb to purchaseluxury footwear specialist Stuart Weitzman Holdings in a deal worth $574 million. The deal was especially surprising, as it marked the very first acquisition in Coach's 74-year history.

Source: Coach/Stuart Weitzman

In explaining its rationale for the purchase, Coach cited "significant domestic and international growth potential" for the brand. Stuart Weitzman achieved net revenue of approximately $300 million in the previous year after enjoying a solid five-year compound annual growth rate of 10%. Going forward, Coach says it will be able to lend its expertise in handbags and accessories to further develop supplementary Stuart Weitzmanproduct lines. In turn, Stuart Weitzman will share its know-how in footwear development to improve Coach products.

That is not to say Coach was previously failing to hold its own in footwear. Last quarter, Coach said its footwear collection enjoyed positive responses from both men and women. In particular, women's boots showed strength, helping its women's footwear business grow to about 12% of North American retail sales.

According to Coach CEO Victor Luis, that made the existing footwear segment a $200 million business by itself. And combined with Stuart Weitzman, Coach will be the second largest U.S. market share player in the premium shoe market, behind only Uggs.

Finally, keep in mind that Coach is currently implementing a costly multi-year "transformation" planafter losing ground in its core North American market to faster growing competitors such as Michael Kors. In the meantime, however, patient investors can collect an attractive 3.2% dividend. Andif that transformation goes as planned, Coach should emerge stronger than ever and ready to resume profitable growth with the help of its thriving footwear business. When that happens, I think patient investors will be happy they held on.

The article 3 Best Stocks for Investing in Footwear originally appeared on Fool.com.

Steve Symington owns shares of Coach and Under Armour. The Motley Fool recommends Coach, Michael Kors Holdings, Nike, and Under Armour. The Motley Fool owns shares of Coach, Michael Kors Holdings, Nike, and Under Armour. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.