NEW YORK (TheStreet) --Shares of Nike (NKE) - Get Reportwere falling in early afternoon trading on Monday, as Bank of America/Merrill Lynch downgraded the stock to "underperform" from "neutral." In light of the call today, the "Fast Money Halftime Report" panel on CNBC discussed the stock.
"It's a huge call, and I can't disagree with it because of what happened last week when [Under Armour (UA) CEO] Kevin Plank came out and said the opportunity is too greedy," TheStreet's Jim Cramer said on the show.
The opportunity Plank was alluding to was that the increase in the price of sneakers is too big to ignore.
"Kevin Plank is your worst nightmare opponent because he was willing to hurt his own stock. This is a key downgrade, and it's a right one," Cramer added.
Najarian Family and Advisors Office co-founder Pete Najarian noted the competition from Adidas (ADDYY) as negatively impacting Nike stock.
"Adidas is making headway when you look at North America. They have come to North America, and they're absolutely going right after Nike," he said.
"Nike doesn't seem to have the near-term momentum that Adidas does," Virtus Investment Partners Chief Market Strategist Joe Terranova stated.
Explaining that investment money has flowed into Adidas year-to-date, and when that money comes out of Adidas, he believes it will flow into Under Armour.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "buy" with a ratings score of B.
The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, growth in earnings per share and good cash flow from operations. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.
You can view the full analysis from the report here: NKE