Consumer Discretionary

Nike (NKE) received an investment rating downgrade on Friday to sector perform from outperform from RBC Capital Markets, which said the athletic footwear and apparel company’s latest guidance implies no revenue growth in 2024 and thus “leaves little to play for in the near term.” RBC also lowered its price target on Nike’s stock to $100 per share from $110. The shares, which closed Thursday’s session at $100.82 each, fell 6.5% to $94.25 in recent Friday pre-market activity amid disappointment over the guidance. After Thursday’s market close, Nike released better-than-expected results for its fiscal Q3 ended Feb. 29. However, on a conference call after the report, Chief Financial Officer Matthew Friend said Nike is “prudently planning” for sales to be down by “low single digits” for the first six months of the next fiscal year, according to a company transcript. Friend cited “near-term headwinds from lifecycle management of key product […]

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We raise our 12-month price target by $4 to $95, based on 25.3x our FY 25 (Mar.) EPS estimate and below the company’s 2-year average forward P/E multiple of 29.4x, reflecting our view that growth will be harder to come by for the footwear and apparel giant over the next 5 years. We raise our FY 24 EPS estimate by $0.15 to $3.65 and maintain our FY 25 EPS estimate of $3.75. NKE posts normalized Q3 EPS of $0.98 vs. $0.79, $0.23 above consensus estimates on revenues of $12.43B vs. $12.39B and $130M above estimates. By region, China revenues grew 6%, EMEA declined 4%, North America grew 3%, and APLA grew 4%. Q3 gross margin increased 150 bps to 44.8%, driven by lower freight and logistics costs

RBC Capital analyst Piral Dadhania downgrades Nike (NYSE:NKE) from Outperform to Sector Perform and lowers the price target from $110 to $100.

Wedbush analyst Tom Nikic reiterates Nike (NYSE:NKE) with a Outperform and maintains $115 price target.

Nike is one of the most mentioned companies in the U.S. across all news items in the last 12 hours, according to Factiva data. Nike said revenue rose slightly in its third quarter amid a recovery in wholesale sales as the company implements a restructuring plan that includes about 1,600 layoffs. The company said quarterly profit fell to $1.17 billion, or 77 cents a share, from $1.24 billion, or 79 a share, in the year-earlier quarter. Analysts polled by FactSet had forecast earnings per share of 69 cents. Revenue rose 0.3% to $12.43 billion, coming in ahead of Wall Street expectations for $12.28 billion, according to FactSet. Dow Jones & Co. owns Factiva.

Nike’s (NKE) outlook for H1 2025 implies no revenue growth for calendar year 2024, which “leaves little to play for in the near term,” RBC Capital Markets said in a note to clients on Friday. The company is “prudently” projecting sales to be down by low-single-digits for the first six months of its following fiscal year, Nike Chief Financial Officer Matthew Friend said during a late Thursday conference call to discuss fiscal Q3 financial results, according to a Capital IQ transcript. The guidance “reflects near-term headwinds from life cycle management of our key product franchises, more than offsetting the scaling of new products as we shift our product portfolio toward newness and innovation,” Friend said. “This also continues to reflect the subdued macro outlook around the world.” RBC said that “organizational restructuring [plus] product transition over the next few quarters add further uncertainty and guidance risk in our view.” “We