Fri Feb 07 14:40:00 UTC 2025: **Nike Stock Underperforms Despite Q2 Beat; Analysts Remain Divided**

**Beaverton, OR – February 5, 2025** – Nike, Inc. (NKE), a global leader in athletic apparel with an $113.5 billion market cap, is facing headwinds despite reporting better-than-expected second-quarter earnings. While the company exceeded Q2 expectations with earnings per share (EPS) of $0.78 and revenue of $12.4 billion, shares have underperformed the broader market over the past year, falling 23.2% compared to the S&P 500’s 21.8% gain.

The decline is attributed to several factors, including lower retail traffic, weak market trends (particularly in September and October), and a significant drop in digital sales (21% for the Nike brand) and wholesale revenues (3%). Nike’s projected low double-digit revenue decline and substantial gross margin drop for the third quarter further fueled investor concerns. Analysts predict a 48.1% year-over-year EPS decline to $2.05 for the fiscal year ending May 2025.

Despite the negative outlook, Nike’s consistent earnings surprises over the past four quarters offer a glimmer of hope. Analyst sentiment remains mixed, with a consensus “Moderate Buy” rating based on 16 “Strong Buy,” one “Moderate Buy,” 14 “Hold,” and two “Strong Sell” ratings. This is a slight improvement from three months ago. However, UBS recently lowered its price target to $73, citing concerns about future performance. The current average price target sits at $84.27, while the highest target is $120, suggesting a potential upside of 58.6%. The company’s stock is currently trading below these targets.

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