Nike (NKE) 3Q22 Earnings Beat Was High Quality - Morgan Stanley

March 22, 2022 6:48 AM EDT
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Price: $88.97 +0.37%

Rating Summary:
    33 Buy, 19 Hold, 2 Sell

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Morgan Stanley analyst Kimberly Greenberger reiterated an Overweight rating and $192.00 price target on Nike (NYSE: NKE) after 3Q22 EPS of $0.87 exceeded Street expectations of $0.71 on better-than-expected results on every line item. Key takeaways included:

  • better-than-feared NA & EMEA revenue growth
  • a sequential improvement in China revenue growth
  • underlying demand for the brand remains strong

The analyst stated "NKE reiterated 2022 revenue guidance, and slightly improved gross margin and SG&A guidance, despite macro volatility and Covid related lockdowns in China (+MSD% y/y revenue growth, "at least +150 bps y/y" GM expansion to 46.3%+ implied, and "mid-teens" y/y SG&A dollar growth vs. +MSD% y/y, +150 bps y/y, and mid-high-teens y/y prior). All in, we think 2022 guidance remains conservative but prudent given the dynamic macro environment."

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 $130.19 yesterday.

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