Nike’s (NKE) Q4 results were “very choppy” with the company missing its Q4 sales estimates and “meaningfully” cutting its fiscal 2025 guidance, Wedbush said in a note to clients on Friday.
The company’s revenue fell to $12.61 billion for the three months ended May 31 from $12.83 billion a year earlier. Analysts polled by Capital IQ expected $12.86 billion. Earnings rose to $0.99 per share from $0.66 a year earlier. Analysts expected $0.83.
Wedbush cut Nike’s price target to $97 from $115, while keeping its outperform rating. The firm also cut Nike’s fiscal 2025 EPS forecast to $3.06 from $3.89 and the fiscal 2026 EPS estimate to $3.48 from $4.35.
“We remain at outperform due to our expectation that [Nike] will eventually ‘figure it out,’ but our conviction in our thesis has certainly taken a hit,” said Wednesday analysts, including Tom Nikic.
The analysts noted that Nike now expects fiscal 2025 revenue “to decline – MSD (vs. prior expectations for growth).”
The “challenges facing the company are clearly more impactful than we (or management) expected,” the note said.
“We doubt many investors will view this as a ‘buy the pullback’ event, and we think [Nike] shares are headed for a stay in the proverbial penalty box until new product innovations actually start to manifest themselves and management regains investor trust,” Wedbush said.
Shares of Nike fell more than 18% in recent