Alexandra Straton, an analyst from Morgan Stanley, maintained the Hold rating on Nike. The associated price target was raised to $72.00.
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Alexandra Straton’s rating is based on a combination of factors that suggest a mixed outlook for Nike. The recent quarterly results indicate that Nike’s turnaround efforts are making progress, with some positive short-term trends. However, these improvements are not consistent across all channels, geographies, and categories, which raises concerns about the sustainability of this recovery.
Despite the positive short-term momentum, Straton remains cautious about Nike’s ability to achieve its medium- to long-term growth and profitability targets. The global sportswear market is becoming increasingly fragmented, which may hinder Nike’s historical growth and margin levels. Additionally, the market seems to have already priced in a successful turnaround, but management’s messaging suggests that the process is still in its early stages and may not be linear. These factors contribute to the Hold rating, reflecting a balance between short-term optimism and long-term skepticism.
In another report released today, Barclays also maintained a Hold rating on the stock with a $70.00 price target.