Nike stock soars as Wall Street posts strong earnings

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Nike stock jumps as investors applaud its upbeat second-quarter report. Wall Street raised target prices.

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Nike

the stock jumped as investors applauded its upbeat fiscal second quarter report, which showed the athletics giant’s pandemic momentum continues.

After the bell on Friday, Nike (ticker: NKE) said it earned 78 cents per share on revenue that rose 7% year-over-year in constant currency to $11.2 billion. Analysts had predicted EPS of 63 cents on revenue of $10.55 billion. The company has seen its digital sales soar by triple digits in North America.

Investors were happy to see the company’s direct-to-consumer omnichannel platform continue to grow at a whim, while key markets like China also appear to have rebounded from the worst fallout from Covid-19. Hopes may have been high at the start of the quarter, but it was hard to fault the results which showed broad-based strength.

Analysts were also pleased with the report and the stock recorded a number of target price increases. Barclays’ Adrienne Yih reiterated an overweight rating and raised her target from $150 to $174. “Nike’s overall pace in the second quarter demonstrates both the consistency of its execution and the competitive advantages of its global scale, customer loyalty, unique product and technological innovation.”

BMO Capital Markets’ Simeon Siegel reiterated an outperform rating and raised his target from $134 to $160, writing that the company’s investments will help Nike consolidate its lead and capitalize on opportunities to grab even more shares of Marlet.

Credit Suisse’s Michael Binetti reiterated an outperform rating and raised his target from $160 to $162, writing that Nike had another strong quarter and he was particularly impressed that digital sales accelerated. even with more stores reopening.

Deutsche Bank’s Paul Trussell reiterated a buy rating and added $10 to his target, which now stands at $160. He writes that the company is successful in all its activities. China is recovering, Nike is cutting ties with less productive third-party partners, and inventory is down.

Matthew McClintock of Raymond James reiterated an outperformance rating and raised his target from $140 to $155: “We believe Nike is well positioned to accelerate market share gains through timely digital investments, strong momentum in brand and financial flexibility.”

Stifel’s Jim Duffy reiterated a buy rating and added $4 to his target, which now stands at $168. He writes that the strong pace and “more confident guidance … underscores the brand’s momentum,” and Nike looks set for “multiple years of improving margins.”

Telsey Advisory Group’s Joseph Feldman reiterated an outperformance rating and raised his target from $155 to $175, writing that the shift to digital sales should propel earnings for years to come. “Nike’s momentum remains robust and its strong execution should help it emerge even stronger from the pandemic.”

Nike stock is up 5.8% at $145.20 in Monday morning trading.

Write to Teresa Rivas at [email protected]

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