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FINANCIALS

Nike Inc (NKE) Price Target Reduced As The Stock Braces For Q4 Earnings Report – Jefferies

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Nike Inc is likely to face pressure from increased competition and weakness in basketball products

Nike Inc. (NYSE:NKE) is among the most popular apparel, sports accessories, sports equipment and footwear producer in the world. The headquarters of Nike are situated in the state of Oregon and it is among the largest multinational corporations in America. The company’s current market capitalization is $92.69 billion and has an average trading volume of 11.15 million shares. The current CEO of the company is Mr. Mark Parker who joined the office in 2006.

Edward Plank, an experienced Jefferies analyst, believes that Nike is headed towards an in line quarter. Although the earnings report will be of critical important the focus of the call will be fixated upon the commentary by the management and the guidance updates for the year 2017. Nike is expected to end the year on a low note as it faces increased pressure from rising competition and slowness in basketball business.

Nike is expected to hold the Q4 earnings call on June 28, after the close of market. Nike is currently faced with a problem of inventory fills and given the competitive pressure from Adidas and Under Armour the company will struggle in maintaining a healthy level of ASPs given the headwinds. As the Olympic games get closer, Nike is likely to increase marketing spend in order to create demand ramps, specially, in the United States. The investors are likely to remain concerned in the near term and are likely to wait on the sidelines to gain clarity as Olympic draws closer.

The analyst reaffirmed a Buy rating, but cut the price target for NKE as the ASP headwinds grow. The analyst opinion for the stock has nine Strong Buy, 15 Buy and eight Hold ratings. The stock now trades at a price of $54.99 and has gained 1.15% in terms of price since the opening of the market.

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