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Key Takeaways
- Nike shares surged 15% Friday after the shoe and athletic apparel maker beat estimates for the fourth quarter.
- Sales and profit fell less than expected year-over-year as new CEO Elliott Hill’s turnaround plan progresses.
- Nike’s CFO said the company expects tariffs to lead to a hit of up to $1 billion in extra costs over its next fiscal year if they stay at current levels.
Nike (NKE) shares soared Friday, a day after the athletic apparel giant topped fiscal fourth-quarter estimates.
After the bell Thursday, Nike—which is the midst of new CEO Elliott Hill’s turnaround plan to return to sales growth—posted smaller-than-expected drops in revenue and profit.
CFO Matt Friend said in Thursday’s earnings call that the company expects to take a hit of up to $1 billion this year due to the tariffs implemented by the Trump administration, as Nike looks to shift as much of its sourcing as possible away from China.
Following the report, JPMorgan analysts lifted their price target for Nike stock to $64 from $56, while maintaining their “neutral” rating. That makes the JPMorgan analysts slightly more bearish than average, with analysts tracked by Visible Alpha holding nine “buy,” seven “hold,” and one “sell” rating, with an average price target of nearly $77.
Nike shares were up 15% in recent trading—a larger move than options traders were expecting—to lead S&P 500 gainers. The stock is within just 5% of where it started the year.
UPDATE—This article has been updated with the latest share price information.
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