Williams Trading's Sam Poser on Nike earnings as stock sees worst trading day since 2024
Speakers
Summary
- Nike (NKE) stock fell ~15% to an 11-year low post-earnings, despite beating its own guidance, due to missing analyst estimates.
- The core issue is a multi-year "fracture" from the prior CEO's aggressive shift to a direct-to-consumer (DTC) model, which axed wholesale support mechanisms and product development.
- Analyst Sam Poser maintains a BUY rating but lowered his price target from $80 to $57, acknowledging the turnaround is taking longer than expected.
- Poser sees "green shoots": improvements in North America, better sell-through for classic products (Air Force 1s, Jordan retros, Air Max), and the rebuilding of wholesale support teams.
- The recovery is regional: North America is progressing fastest, Europe is halfway there, and China is the "worst" and requires a "different fix" due to a lack of prior investment.
- The damage is viewed as a deep operational break that requires healing, not permanent brand impairment, with progress measured by re-engaging wholesale partners.
- A key risk is the pace of execution; UBS and other analysts note a pattern of failed inflection points over the last four years, testing Wall Street's patience.
- Poser is "not pounding the table" on the stock but believes the company is moving in the right direction, albeit slowly.
Trade Ideas
The analyst maintains a BUY rating on NKE, citing they are "doing the right things" and he likes what he's seeing, despite lowering his price target due to a slower-than-expected turnaround. The prior strategy severely damaged wholesale relationships and product pipelines. The new management is rebuilding this support structure, which is leading to concrete improvements in sell-through rates and retailer relationships, particularly in North America. The operational "fracture" is healing, and the company is on the correct strategic path. The current low stock price presents a long-term opportunity as these corrective actions gradually restore health to the business. The recovery timeline remains uncertain and could be further delayed, especially in the critical China market. Continued execution missteps or a failure to reaccelerate growth would break the thesis.
