Nike: Down 75%, insiders are buying

I’m in at 20

My main feedback would be people have been making similar cases that a turnaround is just around the corner for the last 4 years straight. What is different now compared to any time on the slide downward? Terrible company, ruined its brand moat, criminally low profit on high margin shoes manufactured at low costs offshore. It’s no surprise Hoka, On, and a dozen other innovate companies are eating market share.  Perhaps Nike will turn things around but I will need to see actual operational improvement before I even think about putting money that direction. Many better places to deploy capital

Seriously no one even wears Nikes anymore. Dying brand. 

Speaks to the art and science of investing. Science being you can run financial models all day and determine something might be undervalued, art being you can realize when a company is dying and no longer desirable in the eyes of consumers, even if that conflicts with the numbers.

This is like adobe for me-another dying brand that people are still touting

That's not true though. Surveys show Nike is the most desired brand and ranks highest for next purchase consideration

Fair enough for younger cohorts, or at least younger American cohorts. Not sure how well that holds looking older or globally. 

Extraordinary claim. Nike is anecdotally still popular with the younger crowd, including Gen Alpha.

Millennials absolutely still wear Nikes as well because it was the "cool brand" when we were young and it already developed brand loyalty with that generation

Millennials are the exact ones shifting to Hoka and Brooks because they see it’s a much better product for the same or better price. They might buy their $15 t-shirts that have zero profit margins but that’s about it. Source: a millennial that’s getting old and is focused on function and not fashion.

Depends on the shoe style Hoka is a walking/running style shoe. They don't compete in the fashion sneaker area

I always bought my shoes/sneakers at $50-$70, and for years(more like a couple of decades) ago I’d just buy the cheapest Nike or Adidas…. The last few years though, I’ve discovered New Balance’s 2002R, 990’s, 997’s models that are often on sales for $50-$80, depend on colors. I don’t know why the colors will make a $120-$150 shows go on sale for $50-$80 but that seems to be case with those NB models.  Now I sort of consider myself an old head New Balance sneaker head. lol  Hoka’s are very popular with my coworkers (as a dude nurse, I mostly work with lady nurses) but they cost $125-$200. Too much for me. 

FIGS did a shoe collab with New Balance and they might be one of the best sneakers I've ever worn. Mine are getting old but I'll likely be wearing them until the seams wear out. (Or something indescribablely gross splatters on them)

What did you think of the Nike Pulse (as a nurse)?

Don’t know, I haven’t bought Nike in years. The Monarch 4 ($60-$70 on sale) was the last Nike I bought, they’re basically dad shoes/ workers shoes. I just happened to take a shot at those New Balance models that were on sale for $50-$80, and liked them. 

This is very true. I am a millennial and always loved nike but my feet hurt now and kuru supports my feet so well I could never go back to Nike

I view Nike like Budweiser. Popular back when you needed basic level of quality and good cost through a complex delivery supply chain, but led to lack of diverse options. Today there are tons of breweries, and people like different things. Nike isn’t synonymous with high quality, and you can get same quality with more diversity elsewhere. I like Hokas, and I see a ton of other brands out there.

All this bad sentiment on value investing is a good sign, expecially when they say the competitor is brooks. Still waiting, because there's no rush. And who knows, the price could stay low for a few years together with other fashion stocks.

Brooks is a wholly owned subsidiary of BRK it’s not some fly by night operation that will be here today, gone today. Go hit the books kid, you’re out of your league here.

There is no value here

It’s got a base level of popularity as a legacy brand but there’s no coherent path to growth as of now

Stop it. There is a whole culture built around Nike and Jordan

It's dying. Kids these days haven't seen Jordan play. Kobe is gone. LeBron is retiring in a few years. Not only that, replica Nike shoes will sometimes have better QC than real ones. The stigma of wearing reps isn't as bad as it was before . Nike also got greedy and flooded the market when interest rates were zero and Americans had unemployment and stimulus checks. They also tried to cut out middle men like Footlocker by selling direct to customers which allowed competitors to take their spot on the shelves.

Michael Jordan is almost 65 years old. Sales have been declining for years. For a while growth was coming from China but that’s been the steepest decline the last few years. They’re not going to cease to exist, but what growth story are you trying to sell?

You can look at resell numbers to gauge interest. Jordans are pretty much dying off. You'd used to see multiple pairs a day spanning the models, but now you don't really see them on feet anywhere. The NBA has made it so hard to view games that the popularity is dropping off pretty hard. Unless you illegally stream the game it's hard to catch the games since most younger families now are cord cutters. You can look at NYC Knicks won for the first time in 50 years. JB's face is barely in/on any ads. You'd think the whole city would be plastered with ads staring JB. But nope, almost nothing. In Japan you can barely go 100ft without seeing Otani's face.

If I'm buying for actual performance, I'll lean to other brands like the Chinese ones (Li Ning/Anta) or Adidas. Better pricing and just as good, if not better "tech". Heck, the build quality is often better with the chinese brands. Maybe it's different in US with the tariffs and whatnot but here in Asia, it's hard to justify paying for the brand knowing you'll get an inferior product. For casual wear, older silhouettes are fine but there's nothing new that interest me. Doesn't help their brand that the older silhouettes are a lot cheaper compared to a couple years ago when the sneaker market was booming. For example, Dunks are 40% off on their website right now, compare that to 5 years ago where this wouldn't be in stock, much less for 40% off.

Yeah true true. These are observations of people around campus, gym, and the office. Gen Alpha into young Gen Z still seem to like Nike. 

Mexicans love Nike. One half of Mexicans have the Nike logo on their back windshield. One eighth have it on their front windshield.

I'm a geriatric millennial, are Nikes still cool with sneakerheads, botting, etc?

No one willing to wear clown looking On or Hoka’s - sure.

Oncloud’s are by far the most popular sneaker in my office

Doesn’t make them good looking. If I worked in Finance I’d rather die than wear a branded vest. Office fashion can be pretty homogenous.

I’m not talking about the merits of how they look, but clearly people are willing to wear them because I see them everywhere

I mean my sneaker of choice are plain white AF1s... which in my opinion is a timeless shoe... it's also literally hard to go a day without seeing someone wearing AJs.

I wear Nike I like it..

We don't?

Bwahahahaha ok pal. Go to any basketball tournament or AAU tournament and 90% of the shoes are Nike’s (I see them almost every weekend). I am so amused by the volume of people that brush off Nike like they were a fad. They’re literally the number one global sports brand, and by a wide margin to boot!

Thing is, basketball is huge in the US. That’s kinda it. Basketball everywhere else is more niche.

You do realize the top 5 players in the NBA right now AREN’T Americans? I was just having this conversation the other day. One can argue that basketball is the 2nd most popular sport now globally behind soccer. The popularity in Asia and Europe has never been higher.

You also realize, that even if that is true - the sport is still niche in most countries. Has nothing to do with who their top players are. Those might be respected, but it might still be hard enough to follow those games. It might be popular for a smaller set of people, but worldwide - it's soccer. How the US views soccer is how the world sees NFL, MLB and NBA.

All docs here wear Asics and On

Feels like every RN in my hospital wears On (except me)

Sadly, it's true... as impossible as it is to think, Reebok, Converse etc were once dominating brands. Things come and go, but honestly, growing up as a Nike head, I could have never foresee this to ever happen to them. Also a lesson in that CEO makes a hell of a difference. Mark Parker steered the ship, earnings was boring (boring is good) and automatic, money printing... then everything changed.

I am a rookie and want to learn more about the segment you are describing the “low profit on high margin shoe manufacturered at low cost offshore”

He’s highlighting that Nike’s cost to manufacture is low. Nike and other companies like Apple for example are able to make their goods for an extremely low cost because they find other companies to make their goods for them at a fee in a country where ideally labor is cheap. Nike goes and finds a factory that has workers, is willing to buy the equipment, and fund the engineering cost to make the shoe all for a low cost fee. Often called a manufacturers value add. With this, Nike bears little risk and doesn’t need to make large investment commitments. What he’s pointing out is that even with this, Nike’s performance is sub par, while other companies with the same business models doing well.

Why does it have low profit margins, even though it makes its shoes at very low cost?

Its competitors face the same costs. It just means that the company is bloated in comparison to its competitors, with too many highly paid executives that do nothing but add bureaucracy and costs. It’s often very hard for a company to come out of a scenario like that, even with mass firing, because the CEO usually doesn’t know enough to know who to fire to make the company lean.

The gross margin (shoe price minus shoe cost) is high. The problem is they spend ungodly sums of money elsewhere like sponsorships and advertising and R&D so their actual net profit margin is very low. Some of those costs are necessary but Nike’s are out of hand and not providing growth. 

typical US companies spend much more on the design and marketing.

FWIW, Nike was significantly overvalued 5 years ago.

It's still overvalued today

Agree, it used to be a staple brand. But it is now facing a ton of competitors in the last few years such as On, hoka, adidas resurgence, and also lulu from the athletic wear. The company is not dead and not going to go bankrupt anytime soon. But there is no guarantee the growth will come back. I am not interested in this stock until the P/e gets back down to the 12 range.

So youll be a buyer below $30?

I think it needs to be at least below $25, but yeah, I could potentially be a buyer at that level

I just realized NKE is still trading at 24x forward earnings. That's a horrible value for a company with little-no growth. It's even more insane that their 10 yr average valuation was at 34x earnings

As someone who has been burned in fashion before, this has nothing to do with management. Hoka will be the next Nike in a decade or two. The reality is that consumers shift away from a brand as soon as that brand becomes successful and they start seeing it everywhere. Fashion is a terrible business with 0 moat. Nike may still bounce back up, but I am not interested in anything fashion long term.

should larger companies like Nike be creating smaller "brands" to rotate in-out of ?

This is the only way. This is Louis Vuitton’s path to Success. But it’s hard and takes enormous luck to score winners time and time again.

They could also be the next underarmour

On got SMOKED on the earnings today

Yea cause people are finally realizing their shoes suck ass lol

I tried them out, ON shoes are very uncomfortable! Nike and Asics make the most comfortable shoes IMO.

And here I am with my 3 years old and very worn out On shows that I should replace but don’t wanna because they are the single best sport shoes I’ve ever worn. Like running on clouds.

Same here. I love my cloudflyers

Lol! I know some people that love them. But, they are not for me. Next time you see a pair of Asics Nimbus, give them a try. They are super cusioned and comfortable!

I am a big On fan but very few of their actual running shoes have actually been hits for me. Apparel for tennis and running, especially their running rain jacket, and the Roger Centre Court have been my absolute favorites.

I like my On Cloudtilt

I agree! The Nike vomero plus has been a great walking and jogging shoe even if it’s stack height.

They’re too firm and bouncy for me. I came from Nimbus and I like it better.

You should try HOKA, the brand why I don’t buy NIKE anymore.

Man i wore a pair of clouds to Disney. After 3 days my feet broke down, they are trash. ASICS and brooks are where it’s at for me.

Brooks for the win! On my feet 36-40 hours a week as a server and Brooks are the only way to fly. Only last 6 months or so but it's allot of walking. The ghost plus are where it's at.

These companies innovate foams for elite runners and other sports every year and then sell their cheaper EVA foams to walkers and nurses who fret about which shoes most comfortable. They are all the same foam. The shape of one company either suits you or not. The rest is aesthetics.

Absolute suckass

Yes. I see ppl parroting that they are eating Nike’s lunch, but it’s not showing up in their results

They rode this entire wave through hype and marketing alone? Crazy I was interested in them because they're th new hot thing but I have to admit the spacing or holes in the cushion is so impractical for the place I live.

to be fair, they are nowhere near as large as Nike

Nike has my (and everyone else’s) favourite skateboarding shoe and they’re actively trying to pull it off the market.  Why? It wasn’t designed by them but a skateboarder they sponsor and he gets too much royalties lol.

ON has poor branding. People are still reading it as DQ, OQ, OC and the shoes has a funny design that will either break or make them. 

Funny you should say. I bought a brand new pair from goodwill that was labeled DQ a couple years ago.

They're an overpriced one trick pony... they need to find their next niche to crack, not easy. Almost never see anyone that actually do anything sporty wearing On, it's always athleisure, which Nike address alot of that market too, but in the gym, rarely anyone serious wearing On. But hey, there are more people walking than running haha.

Was at the hospital visiting someone and every employee had a pair of ONs on. Had no idea wtf they were until then

Wearers always say they're very comfy, I think it's just a very squishy sole... so walkers love it, anyone doing anything actual don't mess with it.

They are very popular with nurses working 12 hrs shifts mostly on their feet. I'm not a fan of them but I can see why some might like them

Interesting because they said they held back inventory from retailers to focus on higher margin DTC business which is exactly what Nike did and how did that work out for them? You’d think these companies would learn from each other mistakes but …

They’re also notoriously crappy to women (athletes, customers, and employees) that’s help ruin their brand. Personally I’ll never own anything (again) Nike in my life, and I’ll steer athletes I know and coach away from them too.

My friends and I pretty much all switched from Nike to On shoes. Quality feels much better I bought some Nike stock at $49 and regretting it, I don’t see them winning over Gen Z

If you need proof of their current business strategy/, look no further than their NFL jersey/merchandising relationship. Nike said “ we aren’t looking to innovate, we just wanna slap our logo on all your existing merchandise. Just lack of ingenuity & abundance of complacency on the biggest sport in. America. The Oregon Ducks had more Nike uniform options than the entire NFL put together. Nike’s huge contribution is the color rush jerseys….woo you wouldn’t want to miss that creativity…

Nike is just no longer cool. the whoosh is now associated with temu

Dammmm , gottem , uno reverse

Yes. I’m active in the fitness community. I rarely see anyone with Nike gear. Nothing against the brand, itself, honestly. But their products just aren’t appealing. I agree they’re not cool, outside of some of their classics. That can be changed. It’s not too late. But more of the same won’t be the medicine. They have to change.

Hmm not sure about that, i play tennis and Nike is by far the best brand to use in terms of design and even comfort(depends on fabrica ofc). Others are just boring AF

Their div. yield at this price is about 3.9% so you're paid less than holding cash to risk holding a company with poor performance in a terrible interest rate/input costs environment. Big no from me

Dividend isn’t the only return to shareholders

Stagnant companies' share prices can literally bleed out for years. Having an advantageous dividend yield provides a way more stable floor of buyers if you're bottom fishing for stocks that crashed recently

It’s ok if share price stagnates if earnings increase

Dividend is not everything. Treating it as if it is, is irrational.

They ever said it was "everything". As a matter of fact, you're the one saying that they're saying it's everything. Take your own advice and stop saying something is everything.

The comparison above is that the dividend yield is 3.9%, so "you're paid less than holding cash to risk holding a company with poor performance in a terrible interest rate/input costs environment". Theoretically, if Nike doubled its dividend tomorrow, the dividend yield would be 8%. That would not mean the company is better. So the comparison above is incomplete.

It means it’s a more attractive investment at 8% than at 3.9%. Use your brain. It changes the equation a lot.

Dividends come out of company earnings , you don’t buy meta goog msft for a dividend and say it sucks because it pays less than bonds do you ? It’s based on fcf to shareholders and whether or not that can increase

You don’t but others do. Not saying there is a right and wrong approach, but the guy’s comment states that Nike at 8% dividends and 3.9% dividends are the same makes no sense. The information is completely different now.

I personally don’t care about the dividend and just focus on the health of the business

Exactly. Your thesis works for you. This guy is trying to convince people of his thesis and the way he backs it up is 8% or 3.9%, it’s the same thing. My point is 8 is not 3.9 lol, so it does matter.

If Nike doubled its dividend tomorrow it wouldn't be a better company, but it would be a better and less risky investment than it is now. OP just made a completely valid claim that Nike is a struggling company with low dividend payout - there's a strong possibility that share price is going to go even more down, and this dividend yield wasn't able to offset the risk. On the other hand, with 8% dividend yield, holding a struggling company wouldn't be bad since you would get a decent return on investment, and even get it as a cash flow

At this point nike is just another shoe company in a sea of shoe companies.

They actually grew their business in the USA ttm by 5%. The problem is china basically which they have taken drastic measures recently. They are net debt free and have great operational leverage if they can get everything pulling in the same direction. If they can get their business back to 5% top line growth ebitda will be about 9 ish billion in 5 years. Assuming that dividends continue and there is some reduction in shares outstanding and the markets get stingy and only pays 11x ebitda your probably looking at 15% irr over a 5 year holding period from here ( if they can get back to 5% growth). Not a crazy compelling set up but not bad. A punch down into the high 20s would be a gift imo.

This sub is the epitome of inverse reddit. NVO was hyped here relentlessly and now NIKE is the new best thing lol.

This thread is literally full of people hating NKE. I dont think there is one comment praising them, literally.

Barely 5% FCF yield. The company is must spend aggressively to rebuild the in-store channels. I think it is too early.

Didn’t the board have to buy shares to continue being on the board? Maybe I made that up

Whether the market's skepticism about returning to double digit % operating margins with growth is justified depends heavily on execution speed. It's looking like a real turnaround candidate worth watching closely rather than a broken business at this stage of the pullback imo. But patience will likely be required before the numbers actually confirm the thesis, although the stock could start turning before then.

They killed themselves. The brand was the thing. They pulled back from brand marketing and allowed Hoka, On and even fucking Adidas to eat their market share. They lost control of the conversation and it'll take a miracle to get back to where they were.

They got too cocky...they thought they had a MOAT in retail LOL

Down 75% over 5 years and still trading at a 25 fwd PE. Yeah...no... Why catch this falling knife when there are many other businesses out there to invest in?

What companies?

I’ve made posts about Schwab and Sono, and even though Schwab is up 15% since my write-up I still think they’re a good buy

Schwab is my go-to when it dips. Excellent company and not going anywhere. Usually, you can buy at a bargain when the entire financial sector takes a dip. Worse companies drag it down, temporarily at least. And Schwab always bounces back.

Unfortunately they bought TD Ameritrade and I’m stuck with the Schwab app. It’s improved a lot from what it used to be, but it still isn’t amazing. Chuck was also seen with President Pump and Dump during the “tariff shocks”. He’s in on it too.

You can use ToS with schwab now just download the app

Amazon for one?

Already own it

Then why you asking?

I already own Amazon. Asking for other good companies

…you ask Reddit for companies to buy…

This is how I know we’re at the top, anon

Amazon?

MSFT

yes, objectively Nike as it is, really should be another 30% down. the fact that it's held on to the current level is surprising to me, partly because Wall Street is filled with people who grew up on Jordans haha (and even Jordans dont sell out instantly anymore)

If OP can’t wait a few months or year or so for a better opportunity then he is cooked. This is a mediocre business and it’s a far cry from when Michael Jordan was promoting it

Just incorporate AI. Release AI-powered cleats where the cleats retract when you're about to inadvertetly kick another human. This will minimize injuries and yellow cards.

If they made commercially viable Air Mags or something of the sort, I would be all in

Clothing brands are hype brands. Sometimes they have the hype, sometimes they don't. Nike was cool because Jordan made it cool. No amount of logistics is going to make Nike cool again.

Nike is really good at being creative in the hypebeast arena. It's just not translating to a stock price, but it's fine; these past years haven't been a value investor's market and we all know it. The market is irrational

You can only retro the original Jordans so many times before people don't care anymore. Older people who were young when Nike was cool have bills now and young kids don't really know who MJ is. 

I was not talking about Nike's Jordans but rather their other lines

How did going full direct to customer lead to all this?

Lack of physical store presence and pulling its product from authorized retailers. Lost relevance to other brands in the space. Most youngsters would rather wear Alo, GymShark or LULULEMON

Obviously hindsight is 20-20 but what could they have done to stay relevant to younger generations?

One trip to their website. They’re selling shitty men’s sweatshirts for $70-$100 (link below). Brand is no longer desirable. Product quality isn’t high. Price isn’t low. They aren’t winning on anything. https://www.nike.com/w/nike-solo-fleece-8…

FWIW a lot of those items you linked are sold out in a lot of sizes….

No idea how. I can get a better quality sweater or sweatshirt at Tj Maxx or Marshall’s for $20.

Still overvalued....it's going down but I don't think it will be affordable...futures are still too high

I was in it.  We saw the CEO and tim cook buy in, still tanked. I am not sold

Nike needs to go all-in on their ACG branding, it's one of the only "cool" sub-brands they have at the moment that's very on trend.

Nike needs a new air or Jordan, there isn't enough to differentiate between brands right now

No they are not…

If we're going off the chart it's pretty low risk. Breaks below 40 exit the trade.

Nike still isnt even cheap... Down 75% and still trades at a premium valuation compared to other similar clothing brands.

As it should. Nike is better than those companies

"Better than" in what way? It has lower profit margins and less growth than lulu yet trades at double the price

Size, brand, distribution, global reach, they have a footwear business that makes up a majority of their revenue, athlete endorsements, products that appeal across gender and age

I guess its price will continue to drop til it's close to its fair value.

Insiders buy for many reasons, sometimes to prop the stock up, sometimes to save face etc.

Insiders were buying at 2x current price as well

Fair value is around $18

22 give or take

Curious how did you come to this estimated number?

Discounted future earnings back to the present

Boots that are destroying your foot. There is no future for such greedy corporation

Revenue is down, operating margins are down, earnings are down, stock is down. Everything seems to be in order. I personally don't like paying 28 times earnings for a turnaround situation even if we are just looking at going from flat revenue to some increase. You are modeling 3%-5% revenue growth and 10%-14% operating margin. For the worst case in your model of 3% revenue growth and 10% operating margin you say its worth $39 while shares are trading for $41. FY26 revenue growth is 0.2% and operating margins 8% (generous). The conclusion immediately follows from your data. Even if NKE improves to 0.2% -> 3% revenue growth and expands margins 8% -> 10%, the stock is at most fair value ($39). So its not a buy.

0 growth. Still at 20+ PE. Not much of moat. You can buy Meta at similar valuation. Meta did 30% growth YoY. Moat as wide as pacific ocean. Also Nike is really F-ed in the China market. Chinese ppl used to be really into Nike but that trend has reversed and their sales in China has collapsed. This is why investing into retail is super high risk. Consumer taste and trends change too much.

Too many wild dogs biting at their heels. They’re literally competing against (or at least losing market share) to shit I’ve never heard of on Amazon. From backpacks to base layers. This isn’t an airline or a car company that can turn things around operationally and with a few good designs.

Lifetime Nike customer and I’m a pass on this at any price. They just aren’t the same company, have given away their moat and their products don’t hit consumers the way they used to. I’ve been waiting for a sign that they will right the ship but it hasn’t happened. Buying shoes online kind of sucks, their designs are uninspired, anything you think you might want is usually sold out in common sizes. The quality of their clothes has gone way down hill, and again, the designs haven’t kept up with what consumers want. I’ve been making this case for years now and each year it just stays the same/

never buy off cycle retail. Look at the gap or h&m it never came back. Ralph Lauren took 20 years to have a resurgence. Nike will have its time again but you are 10 years early IMO.

Could never morally invest in them after their whole Kapernick thing and promiting the rise of BLM in the USA which caused over $2 billion in property damage and countless deaths

I’m not an expert in clothing companies and fashion trends so I generally try to stay away from those companies. I’ve found I miss the boat of when to buy and when to sell because idk what’s in style. That said, Nike is one that I’m more familiar with and as a result, I’ve been following the stock for a while thinking maybe there’s something there. I played basketball growing up and it was the premier clothing company for shoes, shirts, etc. When I look at the company now, I don’t see things I’d be interested in buying. I see a lot of overpriced, oddly colored clothes. Most of the people my age (30), feel the same way. We’d rather buy the normal colored off brand shirt for 1/4 the price. If I’m not willing to buy the product, why would I be willing to buy the stock?

Too many Nike knock offs out there

I am a buyer around these levels, I think they’re taking good steps to sort out their operating margins, still have big mindshare in key markets, they do close to the same revenue as their next 3 competitors combined and none of those competitors are even what people are talking about when they express their concerns for the brand. This is imo a cyclical trough (or approaching one), being compared to its cyclical peak. IMO Nike will endure they can throw the market cap of companies that they are worried about as disruptors at marketing, are sorting out their bad channel decisions and their tech has been good lately. People will tout the low PE of micron as a reason to buy and the high PE of Nike as a reason not to, but that’s just now how you buy cyclicals. Also sentiment is super pessimistic, always a good signal imo. The operational changes do need a few quarters though so they could easily disappoint for a while still. not financial advice, do your own research etc

Anytime there’s this much negative on here, it’s time to buy the stock. Add some position today @ 40.95 and picked up some $42 call options.

I follow a similar theory but in mine there is a small subsection of the field that love the stock and advocate for it all the time. Nobody loves NKE. NOBODY. I think the consensus is right on this one.

The Nike brand lost its perceived value. Its not a good look for the company when their clothes and shoes are found everywhere, even at the budget stores. At this point, the brand is no different than some swap meet clothes and holds no values.

As an avid collector with close to 300 pairs hundred of pairs at one point… Nike is dead. Without USA sales they'd be in big trouble. Kids this generation moved on to other brands. China basically canceled Nike. 1:1 reps are cheaper and better quality. Now they're turning to AI to help with sales after laying off a bunch of people. They need a new CEO again and fire most of their design team. I’m down to 189 pairs and haven’t bought anything for months. Not touching their stock anytime soon.

Just for me, as a consumer, their quality is terrible. Shoes fall apart in a year, stitching is always loose. I used to buy all my stuff Nike as a runner, and I am now buying Adidas. I also invested a few years ago. It just went nowhere, and I sold when I realised why even own something that I don't even buy?

The thing about Nike is that there’s so much competition in every athletic niche that no one’s compelled to buy their products. They make good stuff but so does a million other brands that they should’ve bought out a decade ago. Also, people know that all this shit is polyester and people who don’t care about brands will just get cheap ass Amazon stuff.

It's too bad New Balance is a private company. They've been growing like crazy recently.

I’m I’m in

Im wearing ON’s and they are too comfy to take off.

As others have said, i think there’s a chance they can turn things around. But I don’t feel confident they will so why would I invest? They literally have cloths at TJ maxx and Marshall’s…the premium days are gone. And the jordan brand fading more and more each year is the nail in the coffin imo. Again, maybe im wrong but thats not a good reason to throw money at something

They seem to have lost their brand halo and I don’t see this brand to ever resonate against with millennials or Gen Z. I think they’ll Slowly shrink and reinvent themself into something niche eventually.

As a consumer, Nike doesn’t excite me anymore. I used to be a loyal buyer.

I havent brought a nike shoe in last 5yrs, so a pass for me.

Its pe doesnt look too terrible. I could start a position for speculation but I'd be quick to offload my initial entry if significantly profitable soon after. Too much other great stuff to chase at lower valuations to the point that it doesnt even make sense to own anything else.

As someone who is very interested in running shoes: Nike’s inability to quickly adapt and release new product to market seems to be their major operational issue. While other major competitors are consistently updating tech/models Nike’s flagship model is nearly 2 years old. This is in a market that is experiencing considerable technological change at the moment. They’re burning their brand reputation quickly unless they turn it around.

Nike got complacent, for a good 5 years, all their signature basketball shoes were literally a low cut with a giant swoosh. SKUs got too much, no innovation. Going online makes sense but trying to kill off major distributors turned out to be a big mistake. Getting that tech guy as the CEO was a mistake. I'm afraid the industry now has a new paradigm, and they are doing too little too late. Elliott Hill, old Nike head etc, makes sense, you can see he's bringing a lot of the old Nike aesthetic back to basketball already, trying to get back the Footlockers and the like. However, ask yourself, has this industry changed? Nike's most powerful money making machine before was their sports superstar marketing, I personally think it just dont work like it used to, too many 'next Michael Jordans' too many signature lines etc, that model don't work no more. This is not just affecting Nike, Adidas and UA suffering the same.

DP $200m at $42ish level

NKE is trash, Deck is a way better shoe company

They alienated their customers by making all the cool shoes limited editions

If we normalize earnings by applying the past 5 year profit margin to the TTM revenues, diluted EPS is approximately $2.912. Looking at the slope of revenue over the past 8 years, the growth rate is 4.27%, consistent with riskless rates today. If we assume that margins return to baseline and growth persists at this rate, I think NKE is finally... Fair value. The pessimism in this comment section suggests to me that it is in for even more downside. It's time to start thinking about buying in, but I'd probably start by DCAing instead of going all in at this price. More attractive prices may be in store soon.

I swear I saw the exact same post months ago.

I lost some money on NKE, but here's the comparison between NKE, Addidas, Decker. NKE is growth revenue at \~3-4%; Addidas is 6-8%; Decker is 7-8%. NKE's next year FY PE is \~24; Addidas is \~18 and DECK is \~13. NKE is projecting \~35% EPS growth for FY27 to FY28. Idk the metrics behind that, but that's their estimates. Therefore, if you believe the EPS growth in FY28 and that NKE can maintain their current PE multiple, there's room for price expansion. Otherwise, it's kind of dead. Below is my anecdotal: I had some big expectations for Elliot Hill, but I don't believe he is turning around NKE's culture. He definitely has more business acumen than his predecessor (similar to PatG for Intel), but execution wise, it's questionable, IMO. I've interviewed at NKE somewhat recently, and the amount of useless middle managers and bureaucracy was a massive turn off. This is consistent with me talking to ex and current NKE employees.

They’ll recover long term. Brands like Hoka and On might be taking some market share, but they are still niche brands comparatively.

Haven’t checked on the fundamentals or positioning and sentiment but the stock seems to be bottoming on price action

Insiders underperform the index

The things is kids funny wear nikes kike they use to.. they're old people shoes. I know they have other beans under the umbrella but idk they are looking a little shaky.

Waiting for $10

No growth story. The Chinese sports brands are coming. Avoid

Inside baggers

https://reddit.com/link/p36lcza/video/8eh… It definitely seems like it is coming around to being fairly valued. Here’s my estimate of fair value My inputs were fairly conservative with a mid terminal value, 4-8% cash flow growth, I also factored in dividend growth and buybacks.

I hope they go to zero. I was one of their retail partners that they axed.

The margin thesis is the right thing to focus on, so worth knowing what is inside the most recent quarter before using it as the base. Q4 gross margin was 49.2%, up 890 basis points. Nike's own wording is that the expected recovery of the IEEPA tariffs, $986m, increased gross margin by approximately 900 basis points. So the whole expansion is that one item, and a bit more. Same thing in the EPS line. Q4 diluted was $0.72, and the release says $0.52 of that is the tariff recovery. Full year net income was $3.1b, down 3%, and that full year already includes the $986m.

Im reverse reddit on this. I think the CEO has a good plan in reversing all the damage done in the past years.

If you buy overhyped pre-revenue tech stock, it will still a better opportunity than buying Nike stock. This company should go bankrupt

They've become an outlet brand with their 24/7 everyday sale/discount/promotions. Even then, the selection is quite exotic.

new balance so much more comfortable

When ever I look at any clothing / running type retail I keep looking at UnderArmour. Great products, widely used, strong brand name and the stock investment was terrible. Is it then just the new kid on the block wins and you jump to the next one. I would much rather own a railroad - three to choose from, barriers are massive, lowest cost way to move stuff - steel wheels on steel rail - lowest friction. Fuel costs are better contained. GL.

saucony bro

Nike ain't coming back. They've lost China (just like every other western brand) and you can't replace that market. Its impossible. Factor in the self-inflicted damage from the last CEO and Eliott has an impossible task. All they can do is hope to hold onto NA, EU and the small markets in SA and AP.

No they’re not 🙄