Bernstein SocGen Group Reiterates Outperform Rating on Nike (NKE)

Bernstein SocGen Group analyst Aneesha Sherman reiterated an Outperform rating and $109.00 price target on Nike (NYSE: NKE).

The analyst comments "The assortment overhaul gets a second wind in October, with Pegasus receiving a positive reception, but consumer interest waning on lifestyle franchises. AJ1, Dunk, and AF1 all have continued high markdowns, while AJ1 and Dunk are still releasing incremental launches weekly. We share the latest on SKU counts, pricing, sell-through, markdowns, brand heat across key franchises. Pegasus - positive reception and a bigger order book. The Pegasus 41 received a warm reception from both Sportswear and Running Specialty wholesalers, as Nike reported Spring order books are up +DD%. In our data, we see a steadily growing SKU countds, consistently high ASP, and normalizing markdowns, and we expect that the momentum should continue. Jordan, Dunk - slower releases, but no cigar. Both franchises are still releasing multiple products each week, though Jordan releases are more on the high-heat products than in AJ1 which remains heavily marked down (nearly 75% markdown breadth in one week). Search interest for both franchises continues to decline while markdown breadth has spiked as Mgmt embarks on a second wave of franchise management tactics to clear products in H1. AF1 - finding the balance of scarcity. AF1 is showing impressive discipline with scarcity of its release pipeline, with far fewer launches than AJ1 or Dunk. Yet the old product isn’t moving, with another wave of markdowns to clear out old inventory. The continued discounting, plus perhaps a lack of newness, is causing search interest to wane."

For an analyst ratings summary and ratings history on Nike click here. For more ratings news on Nike click here.

Shares of Nike closed at $82.15 yesterday.

You May Also Be Interested In