Key Takeaways
- Jefferies analyst Randal Konik maintains a Buy rating on Nike with a $75 price target, suggesting potential gains exceeding 100% from current trading levels.
- The sportswear giant’s shares have plummeted 44% during 2026, pressured by softening Chinese market demand and intensifying competitive threats from brands such as On Holding.
- First-quarter fiscal 2027 results are due Thursday, with Konik projecting 48-cent EPS and $11.5 billion revenue, surpassing consensus expectations.
- The analyst views the upcoming November 16-17 investor day as a more significant catalyst, particularly with newly appointed CFO David Denton expected to provide updated financial guidance.
- Nike’s removal from the S&P 100 on September 21 reflects its struggles, while Wall Street remains dividedāBofA downgraded to Underperform as BTIG increased its target.
Shares of Nike closed Friday’s session at $35.75, hovering dangerously close to the 52-week low of $35.22. Following a devastating 44% decline throughout 2026, at least one Wall Street analyst believes the market may have already priced in the worst-case scenario.
Jefferies analyst Randal Konik reaffirmed his bullish stance this week, maintaining a Buy rating alongside a $75 price objective. Should that target materialize, shareholders would see their investment more than double.
Konik’s bullish thesis hinges on Thursday’s quarterly financial results. He anticipates the report will demonstrate “continued progress” for the embattled athletic apparel company.
The numbers support his optimistic view. Konik projects earnings of 48 cents per share on revenue of $11.5 billion, exceeding Street consensus of 44 cents per share and $11.3 billion in sales.
Signs of Operational Stabilization
Jefferies anticipates stabilization in North American operations and wholesale distribution channels during the quarter. Enhanced inventory management should create a healthier retail environment and drive positive gross margin expansion.
Cost discipline represents another key driver. Jefferies projects selling, general and administrative expenses will decline to 34.5% of revenue from 35.3%, driving EBIT margin improvement to 7.6% from 7.1%.
Nike previously accelerated some gross margin gains into this period. The fourth quarter saw only a 10 basis point decline excluding tariff impacts, significantly better than management’s projected 25 to 75 basis point contraction.
This outperformance stemmed from reduced promotional activity, lower reserves and fewer order cancellations in North America. These developments suggest the domestic market may be stabilizing.
However, challenges persist in certain geographies. Jefferies still anticipates headwinds from Direct-to-Consumer channels, EMEA operations and the China market, with profitability expected to trough before recovering in those segments.
Product categories like Classics, Sportswear and Jordan are also projected to remain under pressure. Jefferies doesn’t anticipate positive growth in these lines until the latter half of fiscal 2025.
November Investor Day Takes Center Stage
According to Konik, Thursday’s quarterly report isn’t the primary catalyst. His attention is firmly fixed on Nike’s scheduled investor day on November 16-17.
Newly appointed CFO David Denton will unveil fresh financial guidance at that gathering. Konik emphasizes that a new CFO “owns none of the prior guidance,” presenting an opportunity for credible reset.
The critical factor, in Konik’s view, is whether Denton establishes fiscal 2027 and 2028 targets that management can consistently achieve and exceed. Rebuilding credibility through achievable forecasts could ignite a meaningful stock recovery.
Nike’s challenging year extends beyond financial performance. Competitor On Holding recently secured a sponsorship deal with soccer superstar Kylian MbappĆ©, stealing him away from Nike in a high-profile loss.
The company’s ejection from the S&P 100 index on September 21 underscores its difficulties. Speculation is mounting that its inclusion in the Dow Jones Industrial Average might also be at risk.
Wall Street analysts remain sharply divided entering earnings. BofA Securities downgraded shares to Underperform, slashing its price objective to $30 amid concerns about product innovation.
BTIG offers a contrasting perspective, lifting its price target to $55 while maintaining its Buy recommendation. Stifel adopted a middle position, reducing its target to $40 while lowering profit estimates for fiscal 2027 and 2028.
BTIG forecasts first-quarter revenue of $11.4 billion, representing a 2% year-over-year decline, with adjusted earnings of 44 cents per share. Nike releases results before market open on Thursday.
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