Morgan Stanley Cuts Nike to Underweight, Sees 20% Downside

Morgan Stanley has resumed coverage on Nike Inc. (NYSE:NKE) with an Underweight rating, citing concerns over earnings per share revisions and potential valuation compression.

The firm's analysts expect second-half fiscal 2027 EPS to be in the mid-single digits percentage below consensus and fiscal 2028 through fiscal 2030 EPS to be approximately 15% below consensus on average.

This is driven primarily by a more conservative revenue outlook, particularly in China, and a slower medium-term recovery than the Street embeds.