UPDATE: Deutsche Bank Upgrades Nike (NKE) to Buy

(updating comment)

Deutsche Bank analyst Paul Trussell upgraded Nike (NYSE: NKE) from Hold to Buy with a price target of $151.00 (from $107.00).

The analyst comments "NKE is a best-in-class consumer brand with 1) an innovative product pipeline in running, basketball, yoga, and sportswear for men & women; 2) robust digital and strong overall direct sales growth that are lifting the margin profile as it becomes a bigger part of the mix; and 3) market share gains across all geographies while also benefiting from an expanding pie through increased consumer focus on health, exercise, sports, and dressing casually. While none of these three points are new to the story, we underappreciated the acceleration that these drivers would experience through the pandemic. In addition, near-term concerns regarding elevated inventory levels in the channel and reduced orders from wholesale partners have not played out. As impressive 1Q results showed, NKE is a better, more profitable company today than it was a year ago and there is quite a short list of entities that have been able to achieve that. In our view, the company continues to guide prudently on both FY21 revenue (HSD-LDD) and GPM (flat) and we are modeling upside to the company's forecast. Ultimately, we believe the case can be made for ~$6 in EPS by 2025 (~18%CAGR)."

For an analyst ratings summary and ratings history on Nike click here. For more ratings news on Nike click here.

Shares of Nike closed at $131.60 yesterday.

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