© Reuters. Nike (NKE) Stock Earns New Buy Rating as Goldman Sachs Sees Over 20% Rise
Goldman Sachs initiated research coverage of Nike (NYSE:) stock rated a Buy with a 12-month price target of $139 per share, suggesting 21% upside potential.
The reason behind the Buy rating is based on the expectation that Nike is poised for a rebound in earnings growth. The company is expected to benefit from temporary cost recovery and an improving market inventory environment.
“In addition, we see room for further revenue growth going forward as the company benchmarks tough and re-accelerates its innovation and marketing engine through 2024,” the analysts said in a note.
Analysts acknowledge near-term challenges such as competition impacting market share, pressures in the wholesale channel and fading tailwinds from specific growth drivers such as Jordan Brand, China and macroeconomic uncertainty.
However, these concerns are considered well understood and are factored into the current valuation, which is still considered “attractive” despite the recent rally in Nike stock.
Nike was named a new Top Pick at Wells Fargo yesterday.
Shares are down 1.6% so far this year.
