Jefferies Sees Stabilization Ahead for Nike Stock

Nike Inc.'s stock has seen a significant decline of 42% year-to-date, but Jefferies is optimistic about its prospects. The investment firm reiterated a Buy rating and set a price target of $75.00 on Nike's shares, which currently trade at $35.75.

Jefferies expects the athletic apparel giant to report first-quarter sales of $11.5 billion and earnings per share of $0.48, surpassing consensus estimates. The firm projects that North America and wholesale channels will stabilize, with better-positioned inventories supporting a cleaner marketplace and positive gross margin in the first quarter.

Jefferies also anticipates expense management driving upside, with selling, general and administrative expenses at 34.5% of revenue compared to 35.3%, leading to an EBIT margin of 7.6% versus 7.1%. The firm views the upcoming investor day and long-term guidance framework as a near-term catalyst for shares.