Nike Pulls Back on Bank of America Downgrade and $30 Price Objective; Dick's Ticks Up, On Holding Holds Flat
Bank of America said Nike’s turnaround is now a full fiscal year later, citing weak China demand, soft wholesale trends and excess inventory.
- On Friday, Bank of America analyst Lorraine Hutchinson downgraded Nike to Underperform from Neutral, cutting the price target to $30 from $47 and pushing the expected turnaround out a full fiscal year.
- Hutchinson wrote that Nike's "pressured classics business" and innovation struggles are overshadowing growth, warning of downside earnings risk as sluggish demand complicates the "Win Now" strategy meant to recover from recent sales slump.
- With China "in flux" and partner online sales reduced, the firm lowered fiscal 2027 and 2028 earnings per share estimates by 11% and 12%, respectively, reflecting tougher demand.
- While Nike shares slumped, competitors remained steady; Dick's Sporting Goods shares rose 2% and On Holding held flat, marking the selloff as Nike-specific rather than a broader athletic category problem.
- Investors should monitor whether retailers like Dick's grow less willing to back new products, a shift that would validate the firm's concerns. Chief Executive Elliott Hill previously noted sell-through in Nike Sportswear and Jordan Streetwear "remains challenged," impacting future order books.
12 Articles
12 Articles
“Moving The Goalposts”: BofA Downgrades Nike, Slashes Target As Turnaround Story Delayed
“Moving The Goalposts”: BofA Downgrades Nike, Slashes Target As Turnaround Story Delayed Nike shares fell 2% in New York premarket trading after BofA retail analyst Lorraine Hutchinson downgraded the world’s largest athletic footwear and apparel company, warning that its “turnaround is taking longer” than expected. With shares trading at 2014 levels, the downgrade adds new woes to a recovery story that might not materialize until 2028. In the r…
Nike Pulls Back on Bank of America Downgrade and $30 Price Objective; Dick's Ticks Up, On Holding Holds Flat
Bank of America just told investors that Nike's comeback is running a full year behind schedule, and the market is punishing the stock while its rivals barely flinch. Whether the selloff stays contained to one brand or spreads across athletic names is the question every investor in this space needs to answer now.
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