Weak Outlook Pours Cold Water on Nike's Upbeat Earnings Results

The firm shared a fiscal fourth-quarter earnings and revenue beat, however

Digital Content Manager
Jun 28, 2022 at 9:21 AM
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Nike Inc (NYSE:NKE) stepped into the earnings confessional this morning, posting fiscal fourth-quarter profits of 90 cents per share on $12.23 billion in revenue, both of which topped analysts' estimates. However, the sportswear concern's current-quarter revenue missed expectations, with Nike noting some weakness in its typically profitable Chinese market. As a result, NKE is traveling lower in premarket trading, last seen down 3% at $107.16. 

It's been a rough year for the Dow component, which has already shed 33.7% in 2022, and 28.4% in the past 12 months. The stock's 80-day moving average has loomed as a ceiling since it broke below the level in early January, while the 20-day trendline has stepped in as short-term pressure in recent sessions. 

Analysts have rushed in with price-target cuts. So far, no less than eight analysts have slashed their price objectives, including BMO all the way to $128 from $142. The brokerage bunch is still incredibly bullish, however. Heading into today, 18 of the 22 in coverage called the stock a "buy" or better. Meanwhile, the 12-month consensus price target of $143.48 is a healthy 29.9% premium to last night's close. 

Short sellers were hitting the exits ahead of Nike's earnings reports. In the last reporting period alone, short interest fell 23.3% and now makes up just a slim 0.8% of the stock's available float. 

 

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