NIKE (NYSE: NKE) stock plunged during intraday trading Friday after BMO Capital downgraded its price target, citing concerns over guidance.
BMO Capital has revised its stance on Nike (NYSE: NKE), lowering the price target from $118 to $100 while maintaining an Outperform rating on the shares. The move comes after Nike released a disappointing guidance.
The analyst from BMO Capital expressed concerns regarding Nike’s forward-looking statements, particularly questioning whether the company had intentionally set a conservative outlook or if there are deeper underlying issues at play. The firm described the guidance as “materially underwhelming,” leading to uncertainty about the company’s financial trajectory.
The discussion focused on whether Nike’s challenges are related to brand management or if they originate from excess inventory that needs to be cleared. The analyst questioned the likelihood of improvement in these trends and the potential impact on revenues for the entire fiscal year.
BMO Capital kept an Outperform rating on Nike’s stock despite uncertainties. The firm’s analysts believe that Nike can revive its business with effective strategic changes. However, they acknowledged the skepticism regarding the efficacy of Nike’s current strategies in achieving desired outcomes.
The analysts’ remark highlights the complexity of Nike’s current situation and the potential difficulties the company may encounter in the coming quarters. While the Outperform rating reflects confidence in Nike’s long-term prospects, the reduced price target reflects a cautious stance regarding its short-term performance.
NIKE (NYSE: NKE) Stock Movement
NKE stock plummeted 19.98% on Friday, closing at $75.37, marking a 22.44% decrease for the week. The trading volume was 129,966,984 shares, significantly higher than the average daily volume of 11.15 million.
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