Should I Buy Nike (NKE)? Finance YouTuber Analysis

The YouTuber sees Nike as a potential turnaround story, with a 3.82% dividend and potential for growth. He believes that despite its current 'terrible' appearance, improvements in profits or a potential buyout could lead to higher returns, aligning with the principle of buying when things look bad.

“It looks terrible, but the best returns are made when things look terrible.”

The analyst reiterates a hold rating on Nike stock, noting that despite a forward P/E of 25 which appears attractive, the company is performing below average with declining revenues in key segments like Nike Direct and Greater China. While tariff refunds boosted gross profit, the overall operating environment remains challenging, and the analyst's fair value estimate is $32.71, below the current price of $42.

“So, I'm reiterating my hold rating on Nike stock. It does not look like an attractive buying opportunity.”

The analyst indicates a willingness to buy Nike stock if its price drops to around $36 per share. This target price reflects a roughly 10% premium over his calculated fair value of $32.71, which he is willing to pay due to sentimental reasons for owning the stock, but he considers the current price of $42 too high.

“I'm targeting a price of around $36 per share. If it dips to around that level, I might buy Nike stock for my portfolio all else being equal, but not at $42.”

The analyst advises against buying Nike stock before its upcoming earnings report, citing worsening fundamentals. Revenue growth is flat or declining, gross profit margins are falling due to tariffs and trade barriers, and the new strategy to rebuild wholesale relationships is showing only slow progress at the expense of direct-to-consumer sales. Additionally, sales in Greater China are declining despite market growth, and the stock's current price of $45 is still considered overvalued compared to his calculated fair value of $36.21.

“So, to answer the question, should you buy Nike stock before earnings? I wouldn't be.”

The YouTuber is buying Nike, believing its current low valuation after an 80% drop presents an opportunity for a long-term investor. He acknowledges recent struggles with inventory and management changes but points to a recent jump in gross profit margin and the strength of its brand as reasons for optimism, expecting a return to historical profitability.

“The question I always ask is simple. Will Nike exist and be bigger 20 years from now? For most people, the answer is yes. So, is today's beaten down price and opportunity?”

The YouTuber suggests Nike is a 'beaten down dog' that will benefit significantly from an expected improvement in consumer sentiment over the next 1-2 years. He views it as a good long-term hold for the next 5-10 years.

“Nike is another one that's a beaten down dog. I think that's going to benefit huge over the next year or two.”

The YouTuber sees Nike as a turnaround play that has already bottomed and is starting to head up. He expects an initial gradual move followed by a quick rally once positive news or guidance emerges, similar to Estee Lauder's recent performance. He highlights the strong brand power as a key fundamental.

“Nike's already clearly shown to me that the stock has bottomed and it's just starting to head up. And when you got to understand when you're talking about a turnaround play, which Nike is a turnaround play, right? the initial move up and I think the stock bottomed I think it was 39 now it's at 45 right that's kind of a a slower move but then once you throw a little fuel on that so some numbers come out some more encouraging things next thing you know encouraging conference call investor presentation the stock rallies quick after that so it's like that initial okay we bottom then we're heading up but it's kind of like a gradual little move and then next thing you know you can see that stock go from 40 to 70 and it happens quick”

The YouTuber believes Nike is poised for a rapid run to $60+ in the short term, potentially starting this week. He argues the stock has bottomed out and is oversold, especially given current low consumer sentiment which he expects to improve. He also states that Nike has already turned its business around, and Wall Street will soon recognize this.

“I believe this stock is has a dramatic move up ahead, right? I believe the move could even start as early as this week and we'll see that stock make a rapid run to 60 plus, right?”

The YouTuber suggests Nike is an attractive buy, stating it's the most opportune time to buy the stock since Michael Jordan's first retirement. He believes it will be a significant money-maker over the next several years and is comfortable holding it for 5-15 years, implying it's a long-term foundational holding rather than a short-term trade.

“It's the most attractive time to buy Nike stock since Jordan retired the first time.”

The YouTuber identifies Nike as a consumer discretionary stock poised for a significant run. He believes that once the current semiconductor stock frenzy subsides, capital will flow into undervalued consumer discretionary names, leading to an '18 to 24-month insane bull run'.

“Nike, another one, 30%. The stock is down year to date. The run's going to be insane.”

The YouTuber views Nike as one of the most hated stocks, trading at $42, far below its all-time high of around $170, after a brutal five-year downtrend. He believes it's a fundamentally strong company that Wall Street will 'love' again in the next one to two years.

“Nike. One of the most hated stocks out there, right? I mean, oh, brutal. Brutal the way this one's been hated, right? 42 bucks for Nike.”

The analyst believes the worst is priced into Nike's stock, which has plunged 36% this year. Despite expected flat revenue and a 30% earnings drop, he anticipates management will offer an optimistic outlook for future quarters as tariff effects wane and gas prices fall. The stock trades at a 20%+ discount to historical valuation, suggesting significant upside if earnings surprise positively.

“Trading at 26 times on a PE basis and just 1.3 times on that price to sales valuation. This is 20% plus discount to a historical valuation that opens up to a big upside if earnings can surprise higher.”

The analyst recommends Nike as a potential buy if the Supreme Court rules against Trump's tariffs. Apparel and footwear companies were among the hardest hit by tariffs, and a refund would provide a significant boost to their profitability, offering a strong potential return.

“Now, apparel and footwear companies like Lululemon Athletica, ticker LLU, Nike, NK, and VF Corporation, VFC, are going to be some of the best potential returns.”

The analyst advises avoiding Nike, categorizing it as one of the 'biggest laggards' in the consumer discretionary sector. This is based on its underperformance in Q1 earnings and the impact of tariffs on the sector.

“While the biggest lagards like Best Buy, Nike, and Lululemon should be avoided.”

The analyst advises avoiding Nike due to disappointing sales in China and the US, with low projected sales growth despite an Oppenheimer upgrade. The risk of a stagnant or dropping stock price outweighs the potential upside, especially given the current retail environment.

“I got to tell you folks with retail sales yet to Rebound in China and weakening in the United States I'm not convinced the risk is worth it just yet”

The analyst recommends buying Nike due to its consistent dividend growth, positioning it to become a dividend aristocrat within three years. The company recently beat earnings expectations, driven by cost-cutting and inventory restocking, with sales projected to accelerate next year due to strong international consumer demand. Institutional buying is expected as it nears aristocrat status.

“Nike ticker ink with its 1.4% dividend yield isn't a big payer but has grown that dividend by about 9% a year over the last five the company usually raises its dividend for its December payment coming up this will be Nike's 22nd consecutive year of dividend increases putting it on track to join the aristocrats within 3 years.”

The YouTuber suggests buying Nike due to low expectations following a previous earnings miss and potential for upside surprise. He notes that the risk-reward trade-off has turned positive, with analyst targets ranging from a 3% downside to a 65% upside, and improved gross and operating margins are expected.

“I think the risk reward trade-off for Nike here has turned positive”

The YouTuber suggests Nike is a buy due to its dominant market share in sportswear, especially after Adidas's misstep with Kanye West. Nike has a strong history of revenue growth and is expected to see profits rebound by 24% next year, making its current valuation more attractive on a forward basis.

“Nike has dominated the market for sportswear ever since growing its share to over 40 percent with only Adidas even close to challenging it and now with a massive 1.3 billion dollar mistake Adidas made on Kanye West Nike could extend its reach even further.”

The YouTuber suggests avoiding Nike for growth investors, despite its current low price, because he views it as a mature, legacy business with significant growth challenges. He notes that the company has struggled with innovation and market share loss to newcomers, making it more of a dividend play than a high-growth opportunity.

“This is not like buying, uh you know, a high-growth company on a discount. That That's not Nike at all, sorry.”

The YouTuber is taking a 'wait-and-see' approach with Nike, noting its declining stock price and perceived drop in quality for mid-tier products, which has allowed competitors to gain market share. While acknowledging Nike's strong brand and professional-level products, he questions whether the new CEO can reverse the negative trends reflected in the company's earnings.

“So, I'm not sure there's anything else to rush into right now in regards to that, but is the next stock at a 52-week low something you should rush into or not because I know there's some folks out there telling you you absolutely should.”

The YouTuber expresses skepticism about Nike's growth prospects, noting that competitors are growing while Nike struggles. He questions the new management's turnaround plan and points to a decline in product quality in certain categories, which he believes is not translating to bottom-line growth despite the brand's widespread presence.

“Do you trust this new management team or not? Again, I don't know. I've not done enough due diligence on it to know this guy's background, to know his plan well enough. But look at that. That right there is what you're buying is what is that plan to get that started again, to get that quality back up with others in a lot of other spaces where they used to dominate.”

The YouTuber suggests avoiding Nike, despite its strong brand, due to recent lack of growth and its status as a turnaround story. He argues that while it might appear cheap, there are faster-growing alternatives like On Holdings that offer better capital efficiency.

“Nike, strong brand worldwide, right? It might still grow although as you know in recent quarter there has been no growth. It's a turnaround story.”

The YouTuber advises avoiding Nike, citing its significant decline (down 54%) and its position within a struggling industry (shoe manufacturing, down 37%). He attributes this to the impact of negative real wages on consumer-facing industries, suggesting that companies like Nike are particularly vulnerable.

“shoe manufacturing, it's down 37%, Nike being the uh the horror show there down 54%.”

The YouTuber advises avoiding Nike stock due to flat revenue, declining gross margins, and poor operational efficiency. He argues that Nike is losing market share to competitors like On Holding and Hoka, and its valuation multiples (P/E of 29, P/FCF of 62) are too high for a company with no growth and poor margins. He believes Nike is shifting towards discount customers, which is not a desirable position for an apparel company.

“This is a company that you should be valuing based on their earnings or their cash flow and that multiple should be very low in the low double digits, 10, 15 times multiple. That's not where we're at with Nike today.”

The analyst argues that Nike is a 'value trap' due to fundamental shifts in consumer advertising and distribution. Legacy brands like Nike, which relied on supply-side power and traditional advertising, are losing market share to digitally native brands like On Holding and Hoka, which are built for direct-to-consumer engagement and social media marketing. Despite a lower valuation, Nike's structural disadvantages mean its profitability and growth will be capped, making it a poor long-term investment.

“Nike may end up being a value, but this looks more like a value trap because of the strategic position that Nike is in today.”

The analyst advises avoiding Nike, citing significant declines in revenue (down 10% overall, 13% in direct-to-consumer) and net income (down 28%). He argues that Nike's strategy of moving away from wholesale partners has backfired, leading to declining market share, especially in North America, and that the company is unlikely to be a growth stock moving forward.

“is this going to be a growth stock I don't think that's going to be the case”

Travis Hoium suggests avoiding Nike in favor of On Holding, arguing that Nike's growth has significantly slowed (2% in the last quarter) and its market expansion opportunities are largely exhausted. While Nike is profitable, its margins are lower than On Holding's and it lacks the same long-term growth potential.

“when we compare Nike and onh holding I don't really think there's any comparison on which investment investors should lean towards”

The YouTuber suggests Nike as a solid long-term investment, emphasizing its strong brand and powerful position in the fashion business. Despite a relatively low 1.3% dividend yield and recent flat stock performance, he believes Nike will remain relevant for decades, consistently generating cash from its existing business.

“If you're looking for a solid company that's going to be likely around and very relevant 10 20 30 years from now I think Nike is going to be one of those companies.”

The analyst views Nike as a long-term winner, citing its consistent cash generation and profitability despite high valuation and single-digit growth expectations. He emphasizes Nike's enduring brand strength and market position, making it a reliable long-term holding.

“Nike just continues to churn out cash and profitability year after year there are very few fashion companies that I would that I would expect to definitely be around and be really strong 10 or 20 or 30 years from now but Nike is absolutely one of those”

The YouTuber views Nike as a phenomenal company for lower-risk investors, citing its significant cash generation and strong growth for a company of its size. While acknowledging its higher valuation at 30 times earnings, he suggests it's a solid choice for those prioritizing stability over the higher growth potential of On Holdings.

“if you're a lower risk investor Nike is absolutely a phenomenal Company still expensive at 30 times earnings but the growth rate is still really strong”

The YouTuber notes that Nike has fallen significantly despite a positive market, indicating that the market has rationally priced in slowing growth and margin deterioration. While not 'particularly cheap' by valuation metrics, he implies it's a more reasonable entry point compared to overhyped AI stocks.

“Nike, den Sportartikelhersteller, auch sehr stark gefallen. Trotz des positiven Marktes wurde hier, glaube ich, relativ rational einfach eingepreist, dass das Wachstum sich verlangsamt hat, teilweise auch ins Minus gerutscht ist und die Marge sich verschlechtert hat.”

The YouTuber considered buying Nike after its significant price drop but decided against it. He notes that while the stock has fallen, its P/E ratio (20, expected 28) is still higher than Alphabet's, despite Nike's declining revenue and gross margins. He highlights real economic issues like product interchangeability, potential tariffs, and a significant drop in direct-to-consumer sales, concluding that the stock is not necessarily cheaper but has fairly depreciated.

“Ich sehe hier realwirtschaftliche Auswirkungen und die können wir uns noch genauer anschauen.”

The analyst states that Nike is trading in the middle of the fair value range and is not considered a huge bargain despite a recent drop. While it's a safe bet due to its strong brand and market leadership, it's not expected to outperform the market.

“Nike is the leader in the space is trading in the middle of the fair value range. I don't think is a huge bargain even after the drop, but if you believe in the company, it's okay to hold a position.”

The YouTuber previously owned Nike but no longer does, believing there could be more trouble ahead for the company. He cites increased competition in clothing brands and a perceived loss of Nike's edge as reasons for its underperformance.

“Nike has been incredibly difficult. So I had Nike before, but I don't have it. And Nike is very sold off. I think there could be more trouble for Nike to come. I mean, there's just a lot of competition. You look at clothing brands. Nike just doesn't seem to really have that edge anymore.”

The YouTuber considers Nike one of the safest stocks to buy, despite recent problems with excessive discounting that devalued its brand. He is optimistic about the new CEO's focus on core sports categories like running and basketball, and the company's strong relationships with athletes. He views Nike as a high-growth company trading at a good value after a 25% pullback, emphasizing the importance of its brand strength.

“I think this is one of the safest stocks to buy right now I mean if you look at a high growth company which Nike Nike is high growth still I think they have a good marketing plan um as well as a good value.”

The YouTuber is avoiding Nike stock, citing declining revenues across all regions, falling gross margins, and increasing competition from brands like On and Lululemon. He believes the stock is still expensive at a 22 P/E ratio given its declining growth and market share losses, and he generally avoids the apparel industry due to its unpredictability.

“i simply think that there are much better stocks in the market right now i also do not invest in the apparel industry because I don't know what brands consumers are going to want to be wearing 10 years out into the future”

The YouTuber expresses skepticism about Bill Ackman's purchase of Nike, stating that he does not find the stock attractive. He notes Nike's revenue and operating income are declining, with management projecting further mid-single-digit revenue declines for fiscal 2025. Despite a 53% drop from its highs, he believes the current price-to-free cash flow of 18.4 is still too high for a company with declining sales, especially given the unpredictable nature of the fashion industry and Nike's potential loss of market share.

“To me personally I do not think that Nike stock is looking quite attractive yet and I don't actually know where I would be buying it or if this is ever a stock that I would want to be buying because I think that the fashion industry is incredibly hard to predict.”

The YouTuber states that while Nike's stock appears cheap relative to historical operating income multiples, the business is facing significant headwinds with projected revenue declines in 2025. He also expresses a lack of understanding of long-term consumer brand trends and moats, making it outside his circle of competence. He believes the stock is still on the expensive side and doesn't offer a sufficient margin of safety.

“it's not a buy for me I do still think that it is a little bit more on the expensive end I don't think that it is offering a massive margin of safety today”

The investor recently added Nike to his portfolio with a small position, indicating an exploratory investment in companies he follows and is passionate about, believing in their future potential.

“Ho aggiunto delle posizioni di Nike”

The YouTuber acknowledges Nike's potential for a turnaround due to its strong brand and new management focusing on athletic partnerships and innovation. However, he states he is not buying it as he typically avoids turnaround plays, and expects a slow year in 2025, suggesting investors might miss the stock if they wait for sentiment to change.

“I normally don't invest in turnaround plays so I'm not buying Nike hair that's not my personal investing strategy”

The YouTuber sold Nike long ago due to increasing competition across various segments, including running shoes and athleisure, which eroded its market share. He believes the company lacks a substantial moat against these competitors and its current valuation doesn't account for its fundamental problems, such as declining revenue guidance and loss of focus in key categories like running.

“The reason that I sold out of Nike long ago was because I knew that there's a lot of competitors taking market share from the company I could see all of these different brands really competing fiercely with them not only in the running category but different brands like Lululemon with athleisure there's so many different companies that are also high quality all trying to eat away at the biggest winner here without anything that I consider to be a substantial moat against these competitors it's difficult to want to invest in this company with a valuation that doesn't leave a lot of room for error so even though Nike's down 20% and we could have a quick recovery in the stock as of right now I think they're facing too many fundamental problems I invest in companies that I believe the fundamentals are becoming stronger”

Bill Ackman of Pershing Square Capital significantly increased his stake in Nike, doubling down after the stock fell 20% on earnings. He believes Nike's direct-to-consumer strategy will pay off in the long run, despite current challenges like tightening consumer spending and sales declines, viewing it as a long-term play during uncertainty.

“Bill Amman is indeed doubling down and buying more Nike shares... Amman clearly seems to believe that this strategy will pay off in the long run.”

The YouTuber reports that Bill Ackman's Pershing Square bought over 3 million shares of Nike, likely after a significant stock drop following a disappointing earnings report. Nike cut full-year guidance and expects sales to drop 10% due to China concerns and consumer spending. Ackman's move suggests he sees value in the brand despite current challenges and a repositioning effort.

“I think that's when Bill Amman would have pounced. He bought over 3 million Nike shares worth roughly 230 million.”

The analyst is holding Nike shares despite a recent 20% drop, believing in a potential turnaround if the management can address current issues. He notes the stock is trading at a lower P/E ratio than its historical average, suggesting it's undervalued, and highlights a secure dividend. However, he acknowledges management missteps in neglecting retailers and a shift in consumer trends.

“Ich behalte meine Nike Aktien wer an die Nike Aktie glaubt an den Turnaround und ein bisschen Zeit mitbringt für den könnte es eine interessante Einstiegsgelegenheit sein.”

The analyst suggests Nike is a buying opportunity despite recent stock declines due to a weak outlook. They argue that the management is proactively addressing issues like increased competition in the sneaker market and implementing cost-saving measures. The stock is currently trading below its historical P/E ratio, indicating a potential undervaluation and offering an attractive entry point for long-term investors.

“ist eigentlich jetzt eher die Frage ist die Aktie jetzt wirklich günstig bewertet”

The YouTuber identifies Nike as a buy due to a recent 12% stock drop following disappointing China sales and a lowered outlook, which has brought the stock to a fair valuation. Despite these issues, North American sales are strong, margins have increased, and the dividend yield is currently attractive relative to its historical average. The company shows a projected 15% annual return expectation for the next 2.5 years.

“sodass wir hier dann mit einer solchen Rendite rechnen können und das halte ich im Prinzip schon für recht attraktiv das heißt wir haben hier mit Nike einen Dividendenzahler der ja einer meiner toppics ist”

The YouTuber sees Nike as an undervalued company and suggests that any further dip in its stock price would present a buying opportunity. They expect it to perform well at some point during the year.

“this one I can see going down a little bit lower but if it do that's just a buying opportunity of another great company that's undervalued that should do its thing at some point throughout this year”

The analyst believes Nike (NKE) is currently overpriced, trading at a high market multiple (29x EV/EBITDA) compared to its historical average (16-17x). While the company exhibits strong fundamentals like consistent revenue and earnings growth, robust free cash flow, and low debt, its current valuation implies a low long-term Internal Rate of Return (IRR) of 4%. He forecasts a long-term price target of $166-$169, which is flat with the current price, suggesting that the market is already pricing in future growth. He recommends waiting for the stock to pull back to around $122 per share or lower to achieve a more reasonable return.

“I think you have to be paying a whole lot less than 122 a share for the stock because of the of the market multiple pullback.”