Nike Stock Hits 52-Week Low After Q1 Revenue Miss, Weak Fiscal 2027 Guidance

Nike Inc. (NYSE: NKE) shares fell sharply Friday, touching a 52-week low after the footwear maker reported a revenue miss for its fiscal first quarter and issued weak guidance for fiscal 2027 that raised doubts about its turnaround efforts.

The stock opened at $33.88, down 3.6% from the prior close, according to data from MarketBeat. The decline accelerated premarket, with shares plunging as much as 9.5% before the bell, according to Benzinga. The intraday low of $31.97 marked a fresh 12-month trough for the stock, which has fallen from a 52-week high of $74.78. The drop erased roughly $4.5 billion in market value, leaving the company with a market capitalization of about $50.27 billion.

Mixed Earnings Results

Nike reported earnings after the close Thursday. The company posted earnings per share of $0.48, beating the consensus estimate of $0.43 by $0.05, as reported by MarketBeat. Revenue came in at $11.21 billion, below analysts' expectations of $11.32 billion. Revenue declined 4.3% year-over-year. In the same quarter a year earlier, Nike earned $0.49 per share on higher sales.

The company also issued a downbeat outlook for fiscal 2027, forecasting EPS in a range of $1.150 to $1.350, well below the average analyst estimate of $1.61, according to MarketBeat. Benzinga and Investing.com both described the guidance as "weak" and a key factor behind the selloff. The weak sales outlook, combined with the revenue miss, overshadowed the solid earnings beat.

Analysts Cut Ratings and Price Targets

Analysts reacted quickly to the results, with several lowering their ratings and price targets. According to a report from MarketBeat, Williams Trading downgraded Nike from "strong-buy" to "hold." Royal Bank of Canada cut its price target to $40 from $45 and maintained a "sector perform" rating. Deutsche Bank trimmed its target to $37 from $45 and held a "hold" rating.

Benchmark upgraded the stock to "hold" from a previous rating, while Sanford C. Bernstein reiterated an "outperform" rating with a $45 price target, per MarketBeat. Online platform Wall Street Zen downgraded Nike from "hold" to "sell."

Separately, Guggenheim cut its price target on Nike to $50, citing guidance concerns, as reported by Investing.com.

Of the 39 analysts covering Nike tracked by MarketBeat, one rates the stock a "strong buy," eight assign a "buy," 22 have a "hold" and eight rate it a "sell." The consensus rating is "Hold" with an average price target of $42.12.

China Weakness Weighs

The results highlighted a deepening sales slump in China, a crucial growth market. According to a Seeking Alpha analysis, Nike's revenue in China declined 26% year-over-year, a sharp reversal that overshadowed relative resilience in North America. The China drag was a significant headwind behind the overall revenue miss and the cautious outlook.

Insider Sales and Institutional Moves

In the quarter preceding the results, two top executives sold shares. Chief Operating Officer Venkatesh Alagirisamy sold 3,671 shares on Sept. 9 at an average price of $37.59, reducing his holdings by 3.38%, according to a MarketBeat report citing an SEC filing. Executive Vice President Philip McCartney sold 2,559 shares on the same day at the same price, a 3.17% reduction. Both transactions were conducted under pre-arranged Rule 10b5-1 trading plans.

Insiders now own 1.10% of Nike's stock.

Despite the recent selloff, several institutional investors increased their positions during the second quarter. Confluence Investment Management boosted its stake by 873.8%, Envestnet Asset Management added 98.4%, and State Street Corp raised its holdings by 6.8%, according to MarketBeat. Institutional investors own 64.25% of the company's shares.

Balance Sheet and Valuation

Nike maintains a strong balance sheet with approximately $8.4 billion in cash and short-term investments, as noted by MarketBeat. The company's debt-to-equity ratio is 0.40, and its current ratio stands at 1.96. The stock trades at a price-to-earnings ratio of 16.29 based on trailing earnings, with a dividend yield approaching 5%.

Looking Ahead

The muted guidance and the increasingly cautious analyst view suggest Nike faces a prolonged period of earnings pressure. The China reset and a tepid sales outlook for the coming fiscal year have replaced optimism over a quick turnaround. With the consensus rating at "Hold" and price targets sliding, investors are pricing in a slower recovery than previously expected.