Canaccord Genuity Maintains a 'Hold' on Nike (NKE); Inventory Levels May Spike
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Price: $40.73 -1.21%
Rating Summary:
26 Buy, 28 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
26 Buy, 28 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Canaccord Genuity maintains a 'Hold' on Nike (NYSE: NKE) price target of $104.00.
Analyst, Camilo Lyon, said, "While NKE continues to drive innovation in the athletic space, we remain cautious on the shares as we believe decelerating sales over the next three to four quarters, the potential for excess inventory post the Euro Champs/Olympic sporting events, and unit declines in H2/13 will result in multiple compression. As such, we believe the risk/reward is skewing to the downside."
"Our regression analysis on NKE’s stock price to sales (88% R²) suggests there is near term downside risk to $95. Such a tight correlation indicates to us NKE is considered a growth stock. As with most growth companies, P/E multiples compress when sales growth decelerates. Given our expectation for sales deceleration to materialize, we believe NKE’s premium 20x multiple will revert back to its 17.5x historical mean multiple."
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 $108.45 yesterday.
Analyst, Camilo Lyon, said, "While NKE continues to drive innovation in the athletic space, we remain cautious on the shares as we believe decelerating sales over the next three to four quarters, the potential for excess inventory post the Euro Champs/Olympic sporting events, and unit declines in H2/13 will result in multiple compression. As such, we believe the risk/reward is skewing to the downside."
"Our regression analysis on NKE’s stock price to sales (88% R²) suggests there is near term downside risk to $95. Such a tight correlation indicates to us NKE is considered a growth stock. As with most growth companies, P/E multiples compress when sales growth decelerates. Given our expectation for sales deceleration to materialize, we believe NKE’s premium 20x multiple will revert back to its 17.5x historical mean multiple."
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 $108.45 yesterday.
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