Nike
NKE
$42.11
+0.98%
Nike, Inc. is the world's largest athletic footwear and apparel brand, designing, marketing, and selling products across categories such as running, basketball, and football (soccer), with footwear generating roughly two-thirds of its sales. The company operates through a global network of company-owned stores, franchised stores (including about 5,500 in China), and third-party retailers, as well as e-commerce platforms in over 40 countries, with production outsourced to contract manufacturers in more than 30 countries. Currently, the stock is under significant pressure as Nike navigates a turnaround amid declining revenue, intense competition from brands like Lululemon and Hoka, and concerns about its position in the Dow Jones Industrial Average, with recent news highlighting tariff-related headwinds and a potential index removal. The investor narrative centers on whether Nike's strategic initiatives, including innovation and direct-to-consumer efforts, can stabilize growth and restore profitability, while the stock trades near 52-week lows, reflecting deep value but unconfirmed recovery.…
NKE
Nike
$42.11
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Investment Opinion: Should I buy NKE Today?
Based on the data, I rate NKE as a Hold. The analyst consensus is 'Buy' with an average target of $50.87, implying 21.1% upside, but the stock is in a downtrend with declining revenue, making it risky to buy before confirmation of a turnaround. The thesis is that Nike offers deep value with a 3.5% dividend yield and a forward PE of 18.3x, but the recovery is unconfirmed, so investors should wait for signs of revenue stabilization.
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NKE 12-Month Price Forecast
The AI assessment is neutral with medium confidence. Nike's valuation is not extreme, but the negative revenue trend and competitive pressures create uncertainty. The forward PE suggests the market expects a recovery, but the lack of confirmed growth makes it risky. I would upgrade to bullish if revenue turns positive and the stock breaks above $45, or downgrade to bearish if revenue decline accelerates and the stock breaks below $40.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Nike's 12-month outlook, with a consensus price target around $50.66 and implied upside of +20.3% versus the current price.
Average Target
$50.66
0 analysts
Implied Upside
+20.3%
vs. current price
Analyst Count
—
covering this stock
Price Range
$23 - $94
Analyst target range
The target price range is wide, from a low of $23.00 to a high of $94.00, reflecting significant uncertainty about Nike's future. The low target of $23.00 implies a 45.2% downside from the current price, suggesting that some analysts see the possibility of continued deterioration in fundamentals, potentially due to prolonged weakness in Greater China or further market share losses. The high target of $94.00 implies a 123.8% upside, which would require a successful turnaround with strong revenue growth and margin expansion. The wide spread between the low and high targets (a range of $71) indicates high conviction divergence among analysts, which is typical for a stock in a turnaround situation with uncertain outcomes. Recent institutional ratings show no major upgrades or downgrades, with most firms maintaining their previous stances, suggesting that analysts are waiting for more concrete evidence of recovery before adjusting their outlooks.
Bulls vs Bears: NKE Investment Factors
Nike presents a classic turnaround dilemma: deep value with a 3.5% dividend yield and a forward PE of 18.3x, but with unconfirmed recovery as revenue declines and the stock languishes near 52-week lows. The bull case rests on the potential for earnings growth (analyst EPS estimate of $4.25) and margin expansion (gross margin up to 49.2%), while the bear case highlights persistent top-line weakness, competitive threats, and tariff headwinds. Currently, the bearish evidence is stronger given the negative revenue trend and technical downtrend, but the wide analyst target range (low $23, high $94) underscores extreme uncertainty. The single most important tension is whether Nike can stabilize and grow revenue again; if it does, the stock could re-rate significantly, but if not, further downside toward the low target is possible.
Bullish
- Deep value with 3.5% dividend yield: NKE trades at $42.00, near its 52-week low of $40.00, offering a dividend yield of 3.53% (payout ratio 77.4%). This provides income support and a margin of safety for long-term investors, as the stock has already declined 44.4% over the past year.
- Forward PE implies earnings recovery: The forward PE of 18.29x is below the trailing PE of 21.87x, signaling that the market expects earnings growth. Analysts estimate EPS of $4.25 for the next fiscal year, up from the current run-rate, which could justify a higher valuation if achieved.
- Strong brand and global scale: Nike remains the world's largest athletic brand with $58.3 billion in estimated annual revenue and a market cap of $68.1 billion. Its extensive distribution network, including 5,500 franchised stores in China, provides a competitive moat that supports long-term recovery.
- Analyst consensus is Buy with upside: With 34 analysts, the consensus recommendation is 'Buy' (mean score 2.49) and the average target price is $50.87, implying 21.1% upside from the current price. Even the low target of $23.00 is below current price, but the high target of $94.00 suggests significant potential if turnaround succeeds.
Bearish
- Revenue declining year-over-year: Q4 FY2026 revenue fell 1.13% YoY to $10.97 billion, and the trend shows deceleration from +1.1% in Q1 to -1.1% in Q4. This persistent top-line weakness suggests Nike is losing market share to competitors like Lululemon and Hoka, undermining the growth narrative.
- Stock in severe downtrend: NKE is down 44.4% over the past year and 34.3% over six months, with relative strength of -65.8% vs. the S&P 500. The stock trades near its 52-week low, reflecting persistent selling pressure and lack of buyer conviction, as it has failed to hold above prior support levels.
- High valuation on declining earnings: Despite the price drop, the trailing PE of 21.87x is not cheap given negative revenue growth. The PEG ratio is -6.78, indicating that the market is paying a premium for expected earnings that have not materialized, leaving room for further de-rating if recovery stalls.
- Tariff and macro headwinds: New Section 301 tariffs on 60 countries at rates of 10-12.5% could raise costs and pressure margins. Nike's global supply chain is exposed, and the company may face pricing power limitations in a competitive market, potentially eroding profitability.
NKE Technical Analysis
Nike's stock is in a pronounced downtrend, with a 1-year price change of -44.36% and a 6-month change of -34.29%. The current price of $42.00 sits near the lower end of its 52-week range, at approximately 52.4% of the range (calculated as ($42.00 - $40.00) / ($80.17 - $40.00) = 4.9%), indicating the stock is near its 52-week low of $40.00 and far from the high of $80.17. This positioning suggests a deeply oversold condition, but also reflects persistent selling pressure and a lack of buyer conviction, as the stock has failed to hold above prior support levels.
Beta
1.12
1.12x market volatility
Max Drawdown
-48.6%
Largest decline past year
52-Week Range
$40-$80
Price range past year
Annual Return
-43.2%
Cumulative gain past year
| Period | NKE Return | S&P 500 |
|---|---|---|
| 1m | -5.1% | +2.4% |
| 3m | -0.6% | +4.7% |
| 6m | -32.5% | +11.7% |
| 1y | -43.2% | +21.3% |
| ytd | -33.5% | +13.4% |
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NKE Fundamental Analysis
Nike's revenue trajectory has turned negative, with the most recent quarter (Q4 FY2026, ending May 31, 2026) reporting revenue of $10.97 billion, a 1.13% year-over-year decline. This follows a pattern of deceleration: Q3 FY2026 revenue was $11.28 billion (down from $11.27 billion in the prior year, roughly flat), Q2 FY2026 revenue was $12.43 billion (up 0.7% YoY), and Q1 FY2026 revenue was $11.72 billion (up 1.1% YoY). The multi-quarter trend shows growth slowing from modest positive to negative, indicating that the company is struggling to generate top-line momentum. Footwear remains the dominant segment at $15.04 billion (from the latest segment data), but apparel at $7.57 billion and other products at $0.08 billion are not enough to offset the decline, suggesting broad-based weakness across categories.
Quarterly Revenue
$11.0B
2026-05
Revenue YoY Growth
-1.1%
YoY Comparison
Gross Margin
49.1%
Latest Quarter
Free Cash Flow
$2.2B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is NKE Overvalued?
Given that Nike's net income is positive (net income of $1.07 billion in the most recent quarter), the primary valuation metric selected is the price-to-earnings (PE) ratio. The trailing PE is 21.87x, while the forward PE is 18.29x, indicating that the market expects earnings growth over the next year. The gap between trailing and forward PE implies an expected improvement in profitability, which aligns with the company's turnaround efforts, but also suggests that the market is pricing in a recovery that has not yet materialized in the financials.
PE
21.9x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 16x~50x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
18.1x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks are significant: Nike's revenue is declining (Q4 FY2026 -1.13% YoY), and while gross margin improved to 49.2%, operating margin is thin at 8.2% (Q4 FY2026 operating income ratio 11.98% but Q3 was only 4.9%). The company carries a debt-to-equity ratio of 0.74, and interest expense was $113 million in Q4, which could strain cash flow if earnings deteriorate. Free cash flow is positive at $2.18 billion TTM, but the payout ratio of 77.4% leaves little room for dividend increases or buybacks if cash flow weakens. Revenue concentration in footwear (two-thirds of sales) and dependence on China (5,500 stores) expose Nike to regional and category-specific shocks.