Nike Recovery Delayed to Fiscal Year 2028 After Q1 Earnings

Nike's turnaround may have been pushed back to fiscal year 2028 after its Q1 FY27 earnings release, according to an analyst. The sportswear segment, which accounts for nearly half of Nike's business, saw a low double-digit decline.

China sales took a hit with a 26% drop, while Nike Direct fell by 18% and Digital dropped by 28%. The analyst believes the Chinese consumer may be under pressure.

The stock is considered expensive, comparable to Nvidia in price. Additionally, insider selling activity has been noticeable this summer.

The analyst is at a Sell rating for Nike but advises against shorting the stock, expecting early signs of a turnaround to emerge in future quarters.