CA - Why Nike Shares Plummeted Following Earnings
2024-07-01 06:37:29 ET
Summary
- Nike stock plummeted over 30% after Q4 earnings, marking the worst single day drop in company history.
- Sales were up only 1% for the fiscal year, the worst growth in over two decades, leading to concerns about long-term prospects.
- Analysts downgraded Nike stock after earnings, citing poor performance and an uncertain growth trajectory.
I last reported on Nike ( NKE ) at the end of March. In that article, I rated the stock as a Hold . The basis for my rating was largely related to the share valuation, but I voiced additional concerns regarding the company’s long-term prospects. While there are many pros to consider when one evaluates Nike as a prospective investment, I questioned whether the company could continue its historic 10% sales growth, and I also contended that Nike’s moat is more vulnerable than others claim.
On Thursday, Nike ((NKE)) provided Q4 earnings, and the stock plummeted 20% after earnings debuted. That marked the worst single day drop in the company's history....
Why Nike Shares Plummeted Following Earnings