Nike Stock Rises 04% on $736M Trading Volume Ranking 97th in Market Activity

On April 29, 2025, Nike Inc. (NKE) saw a 0.40% increase in its stock price, with a trading volume of $736 million, ranking 97th in the day's market activity.

Nike has been facing a challenging promotional environment, exacerbated by currency headwinds and tariffs. Over the past three years, the company's earnings per share (EPS) have declined at a compound rate of 7.6% per year. This reduction in EPS is slower than the 23% annual reduction in the broader market.

Additionally, Nike has been dealing with headwinds related to tariff impositions on footwear and other merchandise. The company's stock has seen a 35% year-to-date drop, but innovation, strong contracts, and market leadership reinforce its long-term potential.

Citi has adjusted its outlook for Nike, reducing the price target from $72 to $57 while maintaining a Neutral rating on the stock. This revision comes as the firm reassesses the impact of tariffs and a challenging sales environment on athletic brands. The updated estimates incorporate a 10% tariff for global markets and a 60% tariff affecting imports from China.

Despite the current volatility, Citi suggests that the relatively modest China exposure among major athletic brands and retailers makes the 10% tariff manageable for the sector. However, the firm remains cautious on Nike given the broader challenges in the market.

Nike's recent financial results show a 9% decline in revenues on a reported basis and a 7% decline on a currency-neutral basis for the third quarter. Gross margins declined by 330 basis points to 41.5% due to higher markdowns, wholesale discounts, and inventory obsolescence. The company is facing challenges in its classic footwear franchises, with double-digit declines impacting overall business performance.

Nike is taking proactive steps to clean up the marketplace, particularly in Greater China, to ensure a healthier inventory and better brand positioning. The company is committed to creating a more integrated marketplace, aligning both direct and wholesale channels to provide a consistent consumer experience.

Nike has successfully launched new innovative products like the Peg Premium and Vomero 18, which have shown strong consumer response and sell-through rates. The company is making significant progress in diversifying its product portfolio, with a focus on performance and sportswear across various categories, including men's, women's, and kids' footwear, apparel, and accessories.