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Nike Inc. (NYSE:NKE) shares have pulled back since the release of the first-quarter earnings report, offering a particularly attractive buying opportunity.
Bank of America analyst Lorraine Hutchinson maintains a Buy rating on Nike, with a price forecast of $84, representing a 38.2% upside from the recent price of $60.80.
Bank of America says Nike’s recent share decline presents a compelling entry opportunity, supported by expectations that its accelerating innovation pipeline will fuel a recovery in sales and margins.
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Analyst noted that Nike’s current Sport Offense strategy, which shifted from a consumer-segment model to sports-based teams, is seen as enhancing category expertise.
The recent launch of the Innovation Engine unifies the design and product development teams across Nike, Jordan, and Converse, establishing a streamlined system intended to scale innovation throughout the entire portfolio, the analyst noted.
The company continues to accelerate its pace of innovation and introduce new products. Multiple launches, such as Nike Skims Drop 2, Air Max 95000, G.T. Future, Aero-FIT, and Nike Mind, highlight Nike’s intensified product development.
Likewise, lifestyle launches such as Ava Rover and retro releases like Vomero 5, P-6000, LD-1000, Air Max 95, and Shox, are expected to offset softness in classic lines.
The bank also noted that the company’s marketing efforts are shifting toward top-of-funnel brand campaigns and storytelling, leveraging major global sporting events as platforms to introduce innovations like Aero-FIT to a broader audience worldwide.
Historical data shows Nike’s revenue growth during World Cup quarters has outperformed other periods, averaging 13% compared to 9% between the first quarter of 2011 and the fourth quarter of 2023.
Hutchinson said Nike is also expected to benefit from expanding its accessible product offerings through value-focused retail channels.
After previously scaling back wholesale distribution of value products, bringing more products priced below $100 to market could give Nike greater flexibility to capture value-conscious consumers if broader discretionary spending slows next year.
The bank projects Nike’s revenue to rise modestly from $47.02 billion in 2026 to $50.33 billion in 2027 and $53.65 billion in 2028, projects earnings per share of $2.16 for 2025 and $1.54 for 2026, followed by $2.77 in 2027 and $3.68 in 2028.
Dividend yield is estimated at 2.6% for 2025-2028, and Nike’s 2026 return on equity is projected at 16.9%.
Price Action: NIKE shares were trading higher by 4.29% to $63.41 at last check Tuesday.
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