Truist Securities analyst Joseph Civello has upgraded Nike, Inc. (NKE) to Buy from Hold, raising the price target to $97 from $83. While acknowledging that Nike’s turnaround process will be lengthy and uncertain, Civello expressed optimism about the stock’s future. He believes investor expectations are now more realistic, giving Nike a better chance to regain momentum.
Civello attributes Nike’s recent struggles to its heavy focus on direct-to-consumer (DTC) growth since 2020, which he argues has stifled innovation and caused customer fatigue with key products. This has made its current franchise management strategy necessary, according to the analyst. Exiting retail partnerships also resulted in market share losses to competitors like ONON and HOKA, which will be challenging to regain.
Despite these challenges, Civello believes Nike is steering in the right direction with experienced leadership back at the helm. He cites the rehiring of 30-year veteran Tom Peddie and the appointment of incoming CEO Elliot Hill, with his strong experience in marketplace and marketing, as key steps in driving the turnaround. While a full recovery is a long-term goal, Civello expects near-term wins, including increased marketing investment, improved wholesale relationships, and promoting ambassador Caitlin Clark, to demonstrate to investors that better times are ahead.
Civello maintained EPS estimates at $2.75 for 2025 and $3.10 for 2026. Nike recently reported first-quarter revenue of $11.59 billion, falling short of analyst estimates of $11.65 billion, but exceeding EPS estimates at 70 cents per share (vs. 52 cents expected).
Investors interested in gaining exposure to Nike can consider ETFs like First Trust Dow 30 Equal Weight ETF (EDOW) and VanEck ETF Trust VanEck Morningstar Wide Moat Value ETF (MVAL).
As of Thursday’s close, NKE shares were down 0.27% at $82.23.
