NKE AI Stock Analysis – Buy, Hold, or Avoid?
NIKE, Inc. (NKE)
Nike's stock is caught between strong long-term brand value and leadership, but faces near-term revenue declines, margin compression, and persistent bearish technicals. While valuation is fair given its premium status and upside potential exists if execution improves, current operational and sentiment headwinds argue for caution. Investors should be selective, with short-term downside risk and long-term recovery hinging on successful turnaround and macro stabilization.
Fundamentals
Nike's fundamentals reflect a brand with tremendous global reach facing a period of revenue contraction and profitability challenges. While quarterly results have consistently beaten analyst estimates, absolute figures show margin compression and ongoing earnings pressure. The company's long-term franchise value and strong execution help offset recent declines, but near-term financial momentum is clearly subdued.
Financial Highlights
- Revenue
- Net Income
- Net Margin (%)
Revenue
0.09% YoY
Q1 2026
Net Income
-34.51% YoY
Q1 2026
Net Margin
Q1 2026
Growth Metrics
Revenue Growth YoY
Latest Quarter: Q1 2026
Net Income Growth YoY
Latest Quarter: Q1 2026
Revenue Per Share Growth YoY
Latest Quarter: Q1 2026
EPS Growth YoY
Latest Quarter: Q1 2026
Book Value Per Share Growth YoY
Latest Quarter: Q1 2026
| Q1 2026 | Q4 2025 | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | |
|---|---|---|---|---|---|---|---|---|
| Revenue | 11.3B | 12.4B | 11.7B | 11.1B | 11.3B | 12.4B | 11.6B | 12.6B |
| Revenue Growth YoY | +0.09% | +0.59% | +1.13% | -11.97% | -9.33% | -7.72% | -10.43% | -1.71% |
| Net Income | 520.0M | 792.0M | 727.0M | 211.0M | 794.0M | 1.2B | 1.1B | 1.5B |
| Net Income Growth YoY | -34.51% | -31.90% | -30.83% | -85.93% | -32.25% | -26.30% | -27.52% | +45.49% |
| EPS | $0.35 | $0.54 | $0.49 | $0.14 | $0.54 | $0.78 | $0.70 | $0.99 |
| EPS Growth YoY | -35.19% | -30.77% | -30.00% | -85.86% | -29.87% | -25.00% | -26.32% | +47.76% |
Profitability Metrics
Technical Analysis
Nike (NKE) is currently entrenched in a strong downtrend with price trading well below its key moving averages and a death cross in place, signaling continued bearish pressure. The RSI is neutral but leaning toward weakness, while the ADX confirms that this bearish trend is strong and likely to persist in the near term. Traders should be cautious and await signs of a bottoming pattern before considering bullish entries.
No extreme reading
Price in downtrend
Strong trend active
50 below 200 - bearish
Key Technical Values
Price with Moving Averages
50-day, 150-day and 200-day simple moving averages
Relative Strength Index
Momentum oscillator measuring speed and magnitude of price changes
RSI (14)
Earnings
Nike's fundamentals reflect a brand with tremendous global reach facing a period of revenue contraction and profitability challenges. While quarterly results have consistently beaten analyst estimates, absolute figures show margin compression and ongoing earnings pressure. The company's long-term franchise value and strong execution help offset recent declines, but near-term financial momentum is clearly subdued.
Latest Earnings
Q1 2026 Earnings (Feb 28, 2026)
Earnings Per Share (EPS)
Actual
$0.35
Estimated
$0.29
Surprise
+$0.06
Surprise %
+20.36%
Revenue
Actual
$11.28B
Estimated
$11.23B
Surprise
+$48.58M
Surprise %
+0.43%
Historical Earnings
| Q1 2026 | Q4 2025 | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | |
|---|---|---|---|---|---|---|---|---|
| Earnings Per Share | ||||||||
| EPS (Actual) | $0.35 | $0.53 | $0.49 | $0.14 | $0.54 | $0.78 | $0.70 | $1.01 |
| EPS (Estimated) | $0.29 | $0.37 | $0.27 | $0.13 | $0.30 | $0.65 | $0.52 | $0.83 |
| EPS Surprise | +$0.06 | +$0.16 | +$0.22 | +$0.01 | +$0.24 | +$0.13 | +$0.18 | +$0.18 |
| % Diff | +20.4% | +41.4% | +80.1% | +7.4% | +79.6% | +20.0% | +34.6% | +21.7% |
| Revenue | ||||||||
| Revenue (Actual) | $11.28B | $12.43B | $11.72B | $11.1B | $11.27B | $12.35B | $11.59B | $12.61B |
| Revenue (Estimated) | $11.23B | $12.21B | $10.99B | $10.73B | $11.02B | $12.13B | $11.64B | $12.86B |
| Revenue Surprise | +$48.58M | +$221.7M | +$730.32M | +$369.11M | +$250.51M | +$224.08M | -$54.3M | -$254.52M |
| % Diff | +0.4% | +1.8% | +6.6% | +3.4% | +2.3% | +1.8% | -0.5% | -2.0% |
Valuation
Nike (NKE) currently trades at valuation multiples reflecting a premium status relative to many peers in the apparel and footwear industry, supported by its strong brand and market position. However, recent earnings pressures and revenue softness have moderated growth expectations, leading to mixed analyst sentiments and a valuation reflecting cautious optimism. The stock's recent pullback positions it with upside potential but also notable execution and competitive risks.
Valuation Metrics
Price to Earnings
TTM
Price to Sales
TTM
Price to Book
TTM
Enterprise Value to EBITDA
TTM
Enterprise Value to Revenue
TTM
| Q1 2026 | Q4 2025 | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | |
|---|---|---|---|---|---|---|---|---|
| Price to Earnings | 44.21 | 30.51 | 39.29 | 106.01 | 37.20 | 25.18 | 29.68 | 24.00 |
| Price to Sales | 8.15 | 7.78 | 9.75 | 8.06 | 10.49 | 9.48 | 10.77 | 11.42 |
| Price to Book | 6.53 | 6.86 | 8.48 | 6.77 | 8.44 | 8.34 | 8.95 | 9.98 |
| Enterprise Value to EBITDA | 192.18 | 85.13 | 105.59 | 179.59 | 117.93 | 77.25 | 92.20 | 83.49 |
| Enterprise Value to Revenue | 8.55 | 8.12 | 10.14 | 8.38 | 10.78 | 9.81 | 11.08 | 11.59 |
Sentiment & Analyst Ratings
Nike's market sentiment is mixed, with strong brand and long-term growth potential offset by recent operational challenges and restructuring efforts. Analyst opinions are divided, reflecting near-term pressures including inventory issues and revenue softness, while valuation metrics indicate substantial upside potential from current levels. Retail and institutional investors appear cautious but some remain committed due to Nike's brand strength and innovation pipeline.
Analyst Recommendations
Risk Assessment
Nike Inc. exhibits a relatively strong liquidity position with ample current assets to cover short-term liabilities, complemented by manageable leverage. However, the company faces moderate risks from tariff pressures, supply chain costs, and competitive challenges, translating to cautious market sentiment despite potential upside opportunities.
Liquidity & Solvency
Current Ratio
Latest Quarter: Q1 2026
Quick Ratio
Latest Quarter: Q1 2026
Debt-to-Equity
Latest Quarter: Q1 2026
Debt-to-Assets
Latest Quarter: Q1 2026
| Q1 2026 | Q4 2025 | Q3 2025 | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | |
|---|---|---|---|---|---|---|---|---|
| Liquidity Metrics | ||||||||
| Current Ratio | 2.14 | 2.06 | 2.19 | 2.21 | 2.19 | 2.22 | 2.36 | 2.40 |
| Quick Ratio | 1.45 | 1.40 | 1.45 | 1.50 | 1.52 | 1.51 | 1.58 | 1.69 |
| Solvency Metrics | ||||||||
| Debt-to-Equity | 0.79 | 0.80 | 0.86 | 0.83 | 0.85 | 0.86 | 0.87 | 0.83 |
| Debt-to-Assets | 0.30 | 0.30 | 0.31 | 0.30 | 0.32 | 0.32 | 0.32 | 0.31 |
Liquidity Assessment
Current Ratio: 2.14(Strong)
Quick Ratio: 1.45(Strong)
The company has strong liquidity with sufficient short-term assets to cover liabilities.
Solvency Assessment
Debt-to-Equity: 0.79(Moderate)
Debt-to-Assets: 0.30(Moderate)
The company maintains a balanced capital structure with manageable debt levels.
Frequently Asked Questions about NKE
AI Answers: Common Questions About NKE
Get AI-powered answers to the questions investors ask most about NIKE, Inc.
Nike is not an ideal buy at this moment given its P/E of 29.04 and ongoing revenue and margin declines, with the stock entrenched in a downtrend and trading near its 52-week low ($42.09). While valuation is fair and long-term upside exists if execution improves, technicals and sentiment argue for patience before entering.
If you already own Nike, there is no urgent reason to sell unless you have a short-term focus, as technicals are bearish and fundamentals are weak. Long-term investors may prefer to hold given the company's balance sheet strength and recovery potential, but should monitor for further deterioration.
The biggest risks are continued margin compression (gross margin now ~40.2%, net margin 4.6%), further revenue declines (down ~9.8% YoY), and execution missteps in restructuring and DTC strategy. Tariff exposure, China weakness, and sector competition also pose material threats.
Technical support is at $42.09, with resistance at $49.36 and $59.47; analysts' average price targets range from $61 to $64, implying 35-45% upside if operational trends improve, but downside risk remains if support fails.
Nike is fairly valued with a P/E of 29.04 and EV/EBITDA above industry averages, reflecting premium brand status. Its P/S is below historical norms, suggesting some valuation reset, but not deep value; further multiple compression is possible if fundamentals worsen.
Nike's fundamentals are challenged: revenue and EPS are declining, margins are at multi-year lows, and earnings quality is weak, though the balance sheet remains strong (current ratio >2.0, manageable leverage). Cost controls are supporting earnings, but organic growth is lacking.
Technical analysis is bearish: the stock is in a strong downtrend with a death cross, trading well below all major moving averages, and RSI at 39 shows mild oversold but no reversal. Downside risk to $42.09 is present unless a basing pattern forms.
Key catalysts include upcoming earnings (for signs of margin stabilization), progress on restructuring and DTC growth, new product launches, and macroeconomic recovery—especially in China. Watch for technical reversal patterns and improved sentiment as signals for entry.
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