Bank of America Securities analyst Lorraine Hutchinson has reiterated their bullish stance on NKE stock, giving a Buy rating today.
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Lorraine Hutchinson’s rating is based on several positive developments for Nike. The company is expected to see a sequential improvement in sales, with a return to growth anticipated in the second half of the fiscal year. This optimism is supported by an increase in holiday global order books, suggesting that partners are confident in inventory levels and the appeal of new products. Despite challenges in direct-to-consumer sales due to clearance inventory and reduced promotional activity, the wholesale segment is showing promising revenue trajectories.
Additionally, Nike’s management has indicated that the worst of the sales and margin pressures from its turnaround strategy are behind them. While there are still some headwinds, such as tariffs and product/channel mix issues, there is potential for gross margin improvement in the latter half of the year. The company is also seeing growth in global running revenue and progress in other sports categories, which could further fuel growth. These factors, combined with a strong innovation pipeline and upcoming sales inflection, contribute to the Buy rating and an increased price objective of $84.
Hutchinson covers the Consumer Cyclical sector, focusing on stocks such as Nike, Kohl’s, and Bath & Body Works. According to TipRanks, Hutchinson has an average return of 7.2% and a 53.30% success rate on recommended stocks.
In another report released today, Needham also maintained a Buy rating on the stock with a $78.00 price target.