Nike Stock Is Trading Near a 7-Year Low. Is Now the Time to Buy?

Source Motley_fool

Shares of Nike (NYSE: NKE) keep on sinking. The company's sales have been underwhelming, and it is facing considerable challenges due to trade wars and the threat of a recession on the horizon. But at the same time, it still owns an iconic brand that resonates with people all over the world.

With the stock trading around levels it hasn't been at in years, could Nike be a good contrarian buy right now?

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Nike's growth rate has been a big problem

As inflation has chipped away at consumer purchasing power, Nike has seen its sales come under pressure. Customers have less money for discretionary purchases, and that's bad news for a company that sells high-priced apparel. In its most recent quarter, sales were down more than 9% when compared to the prior-year period.

NKE Operating Revenue (Quarterly YoY Growth) Chart

NKE Operating Revenue (Quarterly YoY Growth) data by YCharts; YoY = year over year.

And unfortunately, things don't appear to be getting better anytime soon. For the current quarter, which ends in May, the company is projecting its top line to get even worse, and for the decline to be "down in the mid-teens range."

But poor sales numbers are only part of the problem. Nike's net income for the three-month period ending Feb. 28 totaled $794 million, down 32% year over year.

Given the troubling performance and outlook, it's little surprise the apparel stock has not only been hitting new 52-week lows, it is also trading around multiyear lows.

The stock hasn't been this cheap since 2018

Nike's stock has fallen 11% this year, part of a larger decline it has been on for multiple years. The last time you could have bought the stock at a price this low was in early 2018.

NKE Chart

NKE data by YCharts.

The company is in the middle of a turnaround with new CEO Elliott Hill looking to liquidate excess inventory and focus on new styles to draw in consumers. At the same time, Hill is trying to repair Nike's relationships with retail partners; in previous years, the company has prioritized digital sales.

The success of these efforts, however, is just part of the equation. Tariffs and a poor economy could make it difficult for Nike to turn its business around and for its top and bottom lines to show much improvement in the near term.

Is Nike stock worth taking a chance on?

Nike's stock may appear to be cheap based on historical trends, but it's still trading at nearly 29 times its estimated future profits (based on analyst expectations). Given a more troubling outlook for the business and the economy as a whole, it may not be surprising to see the stock continue to fall in the months ahead, especially if the company's financials don't show significant improvement.

It looks like a long, challenging road ahead for Nike, and the big risk is that it may never be a top growth stock again. Unfortunately, with the business facing problems and the economy also on a questionable path forward, this isn't a stock I would buy right now. It may be tempting given how far it has fallen in recent years, but there's still plenty of risk and uncertainty ahead.

If you have a high risk tolerance, are a believer in the brand, and are willing to hang on for multiple years, then Nike might be worth investing in. But for the majority of investors, there are simply much better and safer growth stocks to buy right now.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

  • Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $295,009!*
  • Apple: if you invested $1,000 when we doubled down in 2008, you’d have $42,000!*
  • Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $523,463!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

Continue »

*Stock Advisor returns as of March 24, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nike. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
EUR/USD Price Forecast: Bounces off 1.1300 neighborhood; shows resilience below 23.6% Fibo.The EUR/USD pair attracts some follow-through selling for the second straight day on Wednesday and drops to a one-week low during the Asian session. Spot prices, however, rebound a few pips from the 1.1300 neighborhood and currently trade around the 1.1380 region, still down over 0.35% for the day.
Author  FXStreet
4 Month 23 Day Wed
The EUR/USD pair attracts some follow-through selling for the second straight day on Wednesday and drops to a one-week low during the Asian session. Spot prices, however, rebound a few pips from the 1.1300 neighborhood and currently trade around the 1.1380 region, still down over 0.35% for the day.
placeholder
Top 3 gainers Fartcoin, Zerebro, DeepBook: Solana and Sui meme coins soar on bold risk-on waveMeme coins led by Fartcoin, Zerebro and DeepBook (DEEP) are extending gains during the Asian session on Wednesday amid soaring investor risk appetite. Bitcoin (BTC) briefly crossed $93,000 the previous day alongside widespread rallies among altcoins.
Author  FXStreet
4 Month 23 Day Wed
Meme coins led by Fartcoin, Zerebro and DeepBook (DEEP) are extending gains during the Asian session on Wednesday amid soaring investor risk appetite. Bitcoin (BTC) briefly crossed $93,000 the previous day alongside widespread rallies among altcoins.
placeholder
Dogecoin (DOGE) Pulls Back — Is A Bounce from $0.1650 Support on the Horizon?Dogecoin started a fresh increase above the $0.1700 zone against the US Dollar. DOGE is now correcting gains and might find bids near the $0.1650 zone. DOGE price started a decent upward move above
Author  NewsBTC
20 hours ago
Dogecoin started a fresh increase above the $0.1700 zone against the US Dollar. DOGE is now correcting gains and might find bids near the $0.1650 zone. DOGE price started a decent upward move above
placeholder
DeFi Dev Corp buys additional 65,305 SOL amid broader institutional interest: Solana price slides below $150Solana (SOL) price faces growing overhead pressure and slides below $150 to trade at $148 at the time of writing on Thursday. The sudden pullback follows the crypto market's edging higher on improving investor sentiment, which saw SOL climb to $154 on Wednesday. 
Author  NewsBTC
20 hours ago
Solana (SOL) price faces growing overhead pressure and slides below $150 to trade at $148 at the time of writing on Thursday. The sudden pullback follows the crypto market's edging higher on improving investor sentiment, which saw SOL climb to $154 on Wednesday. 
placeholder
Gold price bulls could regain control amid fading US-China trade deal optimismGold price (XAU/USD) attracts fresh buyers during the Asian session on Thursday, reversing the previous day's heavy losses and snapping a two-day losing streak to the $3,260 area or the weekly low.
Author  FXStreet
20 hours ago
Gold price (XAU/USD) attracts fresh buyers during the Asian session on Thursday, reversing the previous day's heavy losses and snapping a two-day losing streak to the $3,260 area or the weekly low.
goTop
quote