Nike Off to the Races as Analysts Assess Coronavirus-Hit Quarter

Nike's performance amid the coronavirus pandemic has analysts singing the praises of the athletic-apparel icon.
Author:
Publish date:

Nike  (NKE) - Get Report shares jumped more on Wednesday after the sports-apparel maker and retailer's third-quarter financial results led four different investment firms to produce bullish notes. 

The Beaverton, Ore., company came up short on earnings after a 25-cent-a share charge related to the coronavirus outbreak. But it beat revenue estimates.

Nike shares at last check rose 11% to $80.58. 

Stifel (Buy Rating Reiterated, Price Target Lowered to $90 from $110)

"China business-recovery trends are encouraging and Nike can apply the China playbook to other regions. NIKE is as well-equipped to deal with the crisis as any in our universe and has a thoughtful strategy for how to capitalize on the circumstances for the long term. Dislocation from the crisis, however, will impact earnings-power visibility into fiscal 2021 and global economic fallout could impede the revenue and earnings rebound in fiscal 2022," analyst Jim Duffy wrote. 

Deutsche Bank (Hold Rating Reiterated, PT Raised to $84 from $80)

"Nike flexed its muscles this quarter. Facing a global crisis, management outlined its 'playbook' that included shifting launches and some fulfillment centers to digital only, emphasizing at-home fitness in its marketing, including making its premium app service free to consumers, postponing selling, general and administrative expenses (especially spend  associated with sporting events), and opening stores back up on a market-by market basis," analyst Paul Trussell wrote.

JPMorgan (Overweight Rating Reiterated, PT Raised to $91 from $75)

"We see NKE’s brand momentum across geographies as sustainable and providing insulation to macro volatility and supporting sustainable multiyear high-single-digit top-line growth. We view this, combined with continued gross-margin expansion (increased fully price selling, favorable direct-to-consumer mix), driving sustainable multiyear mid-teens EPS growth," analyst Matthew Boss wrote. 

Jefferies (Hold Rating Reiterated, PT Raised to $97 from $75)

"The athletic footwear cycle and brand power are solid. Nike's business is strengthening in North America, and we expect the company to continue to recapture the share it has lost to Adidas. That said, valuation keeps us on the sidelines," the firm says. 

The technical view: Nike Beats on Revenue - Investors Should Trade in This Range