NIKE(US:NKE) Shenwan Hongyuan Securities·2025-12-21 13:41Investment Rating - Neutral rating for the textile and apparel industry as of December 21, 2025 [1] Core Insights - The textile and apparel sector outperformed the market, with the SW textile and apparel index rising by 2.2% from December 15 to December 19, 2025, surpassing the SW All A index by 2.4 percentage points [1][3] - Nike's revenue for FY26Q2 reached $12.4 billion, marking a 1% year-on-year increase, indicating a positive recovery trend in performance [2][9] - The Australian wool price index has shown significant increases, with a year-on-year rise of 39.9% as of December 18, 2025, suggesting a bullish cycle for wool prices [2][37] Summary by Sections Industry Performance - The textile and apparel sector demonstrated strong performance, with the SW apparel and home textiles index increasing by 2.7%, and the SW textile manufacturing index rising by 1.6% during the same period [1][3] Recent Industry Data - Retail sales for clothing, shoes, and textiles in China totaled 1.3597 trillion yuan from January to November 2025, reflecting a year-on-year growth of 3.5% [2][27] - In November 2025, China's textile and apparel exports amounted to $23.87 billion, a decline of 5.2% year-on-year, with apparel exports specifically down by 10.9% [2][31] Key Company Insights - Nike's performance recovery is expected to positively influence the manufacturing chain, with significant contributions to revenue from its supply chain partners [2][9] - The North American market for Nike has returned to growth, while the Greater China region is undergoing structural adjustments [2][9] Market Trends - The Australian wool production forecast has been revised downwards, with an expected production of 244,700 tons for the 2025/26 season, a decrease of 12.6% from previous estimates [2][9] - The apparel sector is advised to focus on companies like Bosideng, which is expected to benefit from seasonal demand and a favorable sales window due to the delayed Chinese New Year [2][10]