Oppenheimer sees no ‘quick fix’ for Nike, downgrades shares

Oppenheimer downgraded Nike to Perform from Outperform with a price target of $110, down from $150. The firm says that while longer-term prospects for Nike and the company’s equity remain compelling, it is increasingly concerned that over the next several quarters, sales trends at the enterprise are likely to remain sluggish and below algorithm. This is due to a combination of “spotty” consumer demand, lulls in product innovation, and modest competitive incursions in select categories, the analyst tells investors in a research note. Nike is “by no means broken,” but the company and its brand are transitioning in the near-term, contends Oppenheimer. The firm is hard-pressed to envision the “still-premium valuation” of Nike climbing higher, until clearer signals of sustained, improved fundamental expansion emerge. It sees no “quick fix” for the company.