NIKE Stock Still Not a Bargain Despite Lower Valuation
NIKE, Inc. (NYSE:NKE) debuted its Caitlin Clark signature collection worldwide on October 1, 2026, coinciding with the release of its latest earnings report. Despite a 40% stock decline this year, the company's new product line, featuring the Caitlin 1 shoe and an 18-piece apparel collection, aims to capitalize on Clark's popularity in the WNBA. However, the earnings report painted a less optimistic picture, with revenue dropping 4% and full-year revenue expected to fall by a high single-digit percentage. EPS for the fiscal year is projected to range between $1.15 and $1.35.
The company's stock currently trades at a forward P/E of about 21.0x, roughly 28% below its historical average of 32.97x. While this lower multiple suggests a more affordable valuation, analysts caution that the stock is not cheap for a company experiencing shrinking profits. EPS is forecasted to decrease by 14.38% this fiscal year before rebounding in fiscal 2028 and 2029. The stock's attractiveness hinges on whether Nike can meet these growth estimates.
Investor sentiment appears cautious, with hedge fund ownership of Nike slipping from 71 funds at the end of Q1 2026 to 56 funds at the end of Q2 2026. Short interest remains high at 8.98% of float as of September 15, 2026. Despite its star power and lower valuation, investors seem to be waiting for a clear sign of recovery before committing to the stock.