- Ahead of Nike Inc NKE’s first quarter (fiscal 2016) earnings call, scheduled for Thursday afternoon, analysts at Deutsche Bank reiterated a Buy rating and $125 price target on the stock.
- They note that, although the stock is already up roughly 20 percent year-to-date, they still see room for upside left.
- Shares of Nike are slightly down on Wednesday trading.
The firm’s upside thesis is based on several growth levers, including the acceleration of the brand’s business in China (following a successful “reset” plan) and continued brand momentum in several important categories.
In the first quarter of fiscal 2016, analysts Dave Weiner andSindhu Chitturi expect to see ASP increases continue, “and strong Futures growth, as investors start to look towards the Oct. Investor Day.”
The firm models earnings of $1.16 per share on revenue of $8.2 billion (up 3 percent year-over-year) for the period. In addition, it projects a 47.1 percent gross margin (up 50 basis points year-over-year), and a 15.7 percent operating margin (up 10 basis points).
Moreover, the experts assure they see upside to their forecasts. Based on their client conversations, they think “investors’ Futures expectations (cc) range from 9%-11% (vs. +14% last year).”
The report highlights three issues to pay attention to in Thursday’s earnings call:
1) Continued momentum in China despite a weaker macro backdrop
2) An update on Nike’s geographic “reset” of its operations in Brazil
3) Commentary on the October 14 Investor Day
Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
|---|
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
