Why Nike saw its stock downgraded a day before the World Cup's kickoff

By Nora Redmond

French star Kylian Mbappe, a Nike endorser, battles for possession Monday with Northern Ireland's Alistair McCann during a pre-World Cup international friendly in Villeneuve-d'Ascq, France.

Nike's stock suffered a crunching tackle on the eve of the World Cup as RBC Capital Markets brought its share-price target for the athletic-apparel giant down from $70 to $50 on slower revenue growth than previously foreseen.

Shares of Nike (NKE) fell 1.5% at $43.97 on Wednesday, and the stock is down by more than 30% in the past six months. It comes a day before the World Cup begins and as shares of its rival and official partner of the soccer tournament, Adidas (XE:ADS) (ADDYY), have risen about 4% in the same span.

Analysts at the investment bank, led by Piral Dadhania, head of luxury- and premium-brands equity research, wrote that while Nike's turnaround under CEO Elliot Hill, who took the helm in October 2024, is making progress, it's been slower going than predicted.

The main challenge the Beaverton, Ore.-headquartered company is facing is exciting consumers with its product range, the analysts wrote.

Dadhania noted that the earlier 12-month price target of $70 was based on the assumption of accelerated revenue growth throughout 2026, supported by a boost in sales driven by the World Cup, the premier event in world football and arguably in all of professional sports. But he now doesn't expect to see the positive results of Hill's turnaround plan, involving repairing relationships with wholesale partners and launching more sport-focused products, until the following year.

The bank also reduced its profitability forecasts by 9% in 2027 and 13% in 2028, bringing RBC's estimates 2% below Wall Street consensus.

From the archives (September 2025): Here's how Nike's stock could benefit big from the next World Cup

Dadhania highlighted Nike's risk of losing market share because of its outlook for revenue growth of just 3% - lower than an unweighted sector average of 6%. While the company's lifestyle footwear is market-leading, it lags Hoka, a unit of Deckers Outdoor (DECK), and privately held New Balance when it comes to running shoes. In women's clothing, relative newcomers Vuori and Alo Yoga as well as Lululemon (LULU) lead in premium price positioning, he wrote.

Nike shoes also account for almost half of the Dick's Sporting Goods (DKS) brand Foot Locker's discounted stock in U.K. and U.S. stores. Dadhania explained that while this partially represents the fact that Nike products account for about 60% of Foot Locker's total revenue, "lower quality inventory and/or softer sell through rates" may also be to blame.

Read on (April 2026): New Nike CEO joins Apple's Tim Cook in betting his own money one the athletic-gear maker's rebound

-Nora Redmond

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06-10-26 1658ET