Bank of America Securities Maintains Buy Rating on NIKE (NKE) Stock

Core Viewpoint - NIKE, Inc. is recognized as one of the best wide moat stocks to buy, primarily due to its strong brand asset and improved sales performance, particularly in apparel and footwear [1][2]. Sales Performance - NIKE's sales growth is attributed to healthy unit volumes across various regions, with a notable increase in units sold in apparel and footwear [1]. - The company has benefited from new distribution points and value channel sales, contributing to its overall growth [2]. Financial Metrics - In Q1 2026, NIKE's gross margin contracted by 320 basis points to 42.2%, but there is an expectation of sequential improvement in the second half of the year [2]. - The anticipated improvement in gross margin is supported by the lapping of previous wholesale support actions, which may help mitigate challenges from tariffs and market fluctuations in China and Converse [2]. Management and Strategy - Under the leadership of new CEO Elliott Hill, NIKE is in the early stages of a turnaround, with significant changes in management and a renewed focus on sports [3]. - Hill's "Win Now" strategy aims to return the company to profitable growth through accelerated product innovation, distinctive marketing, and rebuilding wholesale distribution while adjusting inventory levels [3]. - Although a full turnaround will take time, there are early signs of progress being observed [3].