Nike (NKE) is facing fresh pressure from Wall Street after RBC Capital Markets cut its price target on the athletic apparel giant just one day before the World Cup begins.
RBC lowered its 12-month price target on Nike from $70 to $50, citing slower-than-expected revenue growth as the primary reason behind the downgrade.
Shares in Nike fell 1.5% in pre-market trading to $43.98, with the stock down roughly 30% over the past six months, a stark contrast to rival Adidas, which has risen about 4% in the same period.
The timing is particularly notable given that Adidas is an official partner of the World Cup soccer tournament, which begins Thursday, and stands to benefit directly from the global visibility the event provides.
Analysts at RBC, led by Piral Dadhania, head of luxury and premium brands equity research, wrote that while Nike’s turnaround under CEO Elliot Hill is making progress, it is moving slower than originally predicted.
Hill took the helm in October 2024, and his turnaround plan centers on repairing relationships with wholesale partners and launching more sport-focused products aimed at rebuilding consumer relevance.
Dadhania noted that the initial price target of $70 was built on the assumption of accelerated revenue growth throughout 2026, supported by a boost in sales driven by the World Cup.
He now does not expect to see the positive results of Hill’s turnaround plan until the following year, a meaningful delay that prompted the bank to revise its forecasts significantly lower.
RBC reduced its profitability forecasts by 9% in 2027 and 13% in 2028, bringing its estimates 2% below the current Wall Street consensus.
Dadhania also highlighted Nike’s risk of losing market share, pointing to its revenue growth outlook of just 3%, well below an unweighted sector average of 6%.
While Nike’s lifestyle footwear remains market-leading, the company lags behind Hoka and New Balance in running shoes, a fast-growing category that competitors have capitalized on aggressively.
In women’s clothing, relative newcomers Vuori and Alo Yoga as well as Lululemon lead in premium price positioning, further squeezing Nike’s ability to command full-price sales.
Nike shoes account for almost half of retailer Foot Locker’s discounted stock in U.K. and U.S. stores, raising questions about inventory quality and sell-through rates at the retail level.
Dadhania explained that while this partially reflects 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.
The RBC action compounded pressure from Citi, which maintained a Neutral rating but lowered its own price target to $47 from $53, reflecting concerns that near-term consensus estimates may still be too optimistic.
Nike shares have fallen roughly 50% since Hill’s appointment, while Adidas gained around 70% over a comparable period following its own CEO transition, a divergence that continues to widen.
Nike’s 12-month forward EPS estimates have been revised down roughly 40% since Hill took the helm, according to RBC, underscoring the depth of the challenge facing the brand’s leadership team.
With Nike’s fourth-quarter fiscal 2026 earnings scheduled for June 30, investors appear content to wait for concrete evidence of a genuine turnaround before committing fresh capital at current levels.
