We're adding Nike to our bullpen as the apparel brand embarks on a turnaround

Market Update - Stocks are higher on Monday, overcoming a soft open, with the market-weighted S&P 500 outperforming the Invesco S&P 500 Equal Weight ETF [1] - The data center trade received a boost from Nvidia and OpenAI's announcement of a strategic partnership to build and deploy at least 10 gigawatts of AI data centers, with Nvidia investing up to $100 billion in OpenAI [1] Nike Overview - Nike has been added to the watch list as the company seeks to overhaul its strategy after facing significant challenges since late 2021, particularly due to exposure to China's struggling economy [1] - Under former CEO John Donahoe, Nike lost its innovation edge in the direct-to-consumer business, allowing competitors to gain market share, leading to poor results and Donahoe's departure [1] - Nike veteran Elliott Hill has taken over, focusing on core sports categories and restoring relationships with retail partners, including a return to selling on Amazon [1] - The last earnings report in June showed better-than-expected quarterly results, indicating growing confidence in the turnaround [1] - Management expects to exit the first half of fiscal year 2026 with a "healthy and clean" inventory position, crucial for margins ahead of the holiday selling season [1] - Analysts have recently become bullish on Nike, with Cowen and RBC Capital upgrading their ratings to buy from hold, and Baird naming it a "bullish fresh pick" [1]