Nike Q2 Preview: Sportswear Giant Goes For 10th Straight EPS Beat

Core Viewpoint - Nike Inc. is expected to show progress in its turnaround efforts with the upcoming second-quarter financial results, despite a projected decline in revenue and earnings per share compared to the previous year [1][2]. Earnings Estimates - Analysts predict Nike's second-quarter revenue will be $12.22 billion, a decrease from $12.35 billion in the same quarter last year [1]. - Expected earnings per share for the second quarter are 38 cents, down from 78 cents per share in the previous year [2]. Analyst Insights - Bank of America analyst Lorraine Hutchinson maintains a Buy rating with a price target of $84, emphasizing Nike's strategy to attract value-focused shoppers through initiatives like product offerings on Amazon [3]. - Key focus areas for analysts include Nike's guidance for the third quarter and the performance in China, which is anticipated to show a slow recovery [4]. Recent Performance - In the first quarter, Nike's revenue increased by 1% year-over-year, with growth in North America, Europe, the Middle East & Africa, and Asia Pacific and Latin America, while China experienced a 9% decline [5]. - CEO Elliott Hill noted that while the company is making progress, there is still significant work ahead, indicating a potentially prolonged turnaround process [5]. Key Items to Watch - A strong performance in both earnings and revenue could signify successful turnaround efforts, while any misses could negatively impact stock performance [6]. - Guidance for the third and fourth quarters is expected to be a significant factor influencing stock movement, with the upcoming World Cup potentially driving demand [6]. - Nike is the official outfit partner for 11 teams in the World Cup, including prominent teams like the United States and Brazil [7]. Analyst Ratings - BTIG has reiterated a Buy rating with a price target of $100, while Telsey maintains a Market Perform rating with a price target of $75 [8]. - Guggenheim initiated coverage with a Buy rating and a price target of $77, and Citigroup has lowered its price target from $74 to $70 while maintaining a Neutral rating [8]. Stock Performance - Nike's stock is currently up 0.6% to $66.05, with a 52-week trading range of $52.28 to $82.44, and shares are down 10.3% year-to-date in 2025 [9].