Morgan Stanley Downgrades Nike with 'Underweight' Rating Amid Growth Concerns
Morgan Stanley analysts have reinstated coverage of Nike (NKE) with an 'underweight' rating and a Street-low price target of $31, significantly below the current consensus. The firm cited concerns that the market's expectations for Nike include too much near-term growth—especially in China—and highlighted macroeconomic headwinds as well as competitive pressures. Nike’s stock has fallen more than 40% from its value at the start of the year and hit a fresh 12-year low below $37. The analysts believe that Nike's valuation is misaligned with an increasingly fragmented sportswear market, which could challenge the company's turnaround efforts under new leadership. The firm also noted recent changes in executive roles—such as the appointment of a new CFO—and suggested upcoming events like earnings reports or investor days might be opportunities for management to adjust expectations.
Topics: bearish outlook China market Morgan Stanley Nike stock downgrade