Here’s what Wall Street is saying about Nike ahead of Q1 earnings

Nike (NKE) is expected to report results on its fiscal first quarter on Tuesday, September 30, with a conference call scheduled for 5:00 pm EDT. What to watch for:

GUIDANCE: In June, Nike forecast first quarter revenue to be down mid-single digits, with gross margin down 350-425 basis points. At the time, President and CEO Elliott Hill commented that the company expects its business to improve moving forward as a result of progress Nike is making through its Win Now actions. “As we enter a new fiscal year, we are turning the page and the next step is aligning our teams to lead with sport through what we are calling the sport offense. This will accelerate our Win Now actions to reposition our business for future growth.”

BofA expects Nike will provide Q2 guidance for sales to improve sequentially from in Q1, which would be viewed as another positive step towards a return to growth in the second half. The firm added that Back to school trends in the U.S. were solid. Meanwhile, while Morgan Stanley expects Q1 EPS to come in about in-line with consensus, it continues to think second half and FY26 Street estimates are too high. The firm thinks Nike’s “poor fundamentals continue to get some degree of a pass” in the near-term, but it has “grown incrementally negative,” citing less constructive recent channel checks and what it views as a still-elevated valuation, the analyst tells investors in a fiscal Q1 preview. Citi expects Nike to report better than expected fiscal Q1 earnings due to stronger sales and lower spending, but the firm sees a balanced risk/reward for the shares given a lack of clarity on growth returning to Nike’s basketball and sportswear sales.

‘STEEPER’ REVENUE RECOVERY: RBC Capital upgraded Nike to Outperform from Sector Perform with a price target of $90, up from $76. The firm sees a “steeper revenue recovery” for Nike than Street estimates reflect with new product contribution and World Cup selling. The company is “taking the right steps” and is seeing improvements in the running footwear offer segment, the analyst says. RBC believes Nike is entering a quarterly beat and guidance raise cycle with limited share downside.

TD Cowen upgraded Nike to Buy from Hold with a price target of $85, up from $62. The firm sees three reasons to believe in Nike’s turnaround: the company’s margins have troughed and a recovery is underappreciated, new management’s execution, and improving improving Nike and Jordan trends, according to its field checks. TD’s field work shows signs of Nike and Jordan improvement while share gain and brand heat from upstart peers are slowing, the analyst tells investors in a research note.

GOLDMAN KEEPING ‘CONSTRUCTIVE’ STANCE: Goldman Sachs keeps a Buy rating and $85 price target on Nike ahead of its Q1 results, but notes that the firm is “constructive” on the stock. Goldman said that it expects fundamentals to continue to sequentially improve, adding that while franchise management reset actions are weighing on sales, the firm continues to see emerging green shoots in sport and strategic priorities such as performance running and women’s apparel, the analyst tells investors in a research note.

‘LACKLUSTER’ SALES MOMENTUM: UBS raised the firm’s price target on Nike to $71 from $63 and keeps a Neutral rating on the shares. The firm’s channel checks suggest Nike had “lackluster” global sales momentum through August and UBS expects Nike to deliver just in-line Q1 EPS, the analyst said. UBS anticipates Nike gives an implied Q2 EPS outlook in the range of 31c-48c and guides Q2 sales down mid-single digits year over year.

SENTIMENT: Click here to check out Nike’s recent Media Buzz Sentiment as measured by TipRanks.