BMO Capital initiated coverage of Nike (NKE) with an Underperform rating. The firm established a price target of $30 for the athletic apparel company.
Analyst Kelly Crago identified slowing demand for lifestyle products and a distribution reset in China as primary headwinds. Structurally lower margins further complicate the company's growth outlook.
BMO forecasts that Nike’s earnings per share will return to the $3.00 level in fiscal year 2031. This projection indicates a multi-year delay for a full earnings recovery.
Management will likely reset expectations for fiscal year 2027 during the October 1 earnings report. BMO warns that Nike's premium valuation remains at risk of further erosion.