NKE Stock Heads For Its Worst Week In Nearly Three Months – Wall Street Sees Encouraging Signs But Not Enough To ‘Remain Optimistic’

• The brokerage downgraded Nike to Sector Weight from Overweight without a price target.
• KeyBanc also lowered its estimates for Nike’s fiscal 2027 earnings.
• On Tuesday, Nike named former Pfizer executive David M. Denton as its new CFO.

Shares of Nike (NKE) edged lower in pre-market trading on Friday and are on track for their sharpest weekly slump in nearly three months, amid investor concerns surrounding the company’s operations in China and the ongoing management transition.

NKE shares crashed to nearly 12-year lows on Thursday before trimming some of the losses by the end of the session.

Outlook ‘Clouded’ By China, EMEA Uncertainties

On Friday, KeyBanc downgraded Nike to ‘Sector Weight’ from ‘Overweight’ and did not add a price target, according to The Fly.  Analyst Ashley Owens said the company’s turnaround is taking longer than expected, with the outlook “further clouded” by growing uncertainty in China, Europe, the Middle East, and Africa, along with continued marketplace challenges and management transition.

“There are signs of progress, but not enough for us to remain optimistic,” Owens said.

KeyBanc also lowered its fiscal 2027 estimates slightly and said it will wait for a more detailed strategic update.

NKE’s Latest Triggers: China, Q4 Forecast And A New CFO

Earlier this week, Chinese news agency Sina reported that Nike plans to stop key distributors in China from selling its products online starting Jan. 1, 2027, directing customers instead to Nike’s official online store. This led BNP Paribas analyst Laurent Vasilescu to describe the reported move as a “strategic misstep.”

On Tuesday, Nike named former Pfizer executive David M. Denton as its new CFO. Alongside the leadership change, the sportswear giant reaffirmed its fourth-quarter outlook ahead of results due June 30. While the quarter will benefit from one-time tariff refunds, Nike said its underlying performance is still expected to be broadly in line with the guidance it previously issued.

Oppenheimer Expects Another Soft Quarter

Meanwhile, Oppenheimer halved Nike’s price target to $60 from $120 and kept an ‘Outperform’ rating. This represents a roughly 47% upside potential from the stock’s closing price on Thursday. 

Oppenheimer added that the sportswear brand is expected to report Q4 results largely in line “but still soft.”

Nike is expected to post a revenue of $10.85 billion and earnings of $0.12 per share in the fourth quarter, according to Fiscal.ai data.

NKE Stock: Retail Cautious Ahead Of Earnings Next Week

Retail sentiment on Stocktwits turned ‘neutral’ from ‘bearish’ a day earlier, while message volumes jumped by more than 130% over a 24-hour period. NKE was also among the top trending tickers on the platform at the time of writing.

One user expects the sell-off to continue beyond earnings and for the stock to drop to $23-$26 by the end of the year.

Another user said “not looking good,” while highlighting the company’s finances.

NKE shares have slumped more than 35% so far this year.

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