Wall Street sets Nike stock price for next 12 months

NIKE Inc (NYSE: NKE) is scheduled to announce its earnings for the fiscal second quarter on December 21. Projections indicate a slightly decreased revenue of $13.46 billion, while headline earnings are expected to increase to 85 cents per share, up by 0.61%.

The company has a track record of surpassing revenue estimates in seven of its last eight reports and exceeding earnings forecasts in six of the past eight updates.

Nike is poised to capitalize on the reopening of China following COVID-19 restrictions, given that 15% of its sales originate from the country. 

Anticipated surges in sales in China are on the horizon as consumers resume normal activities and re-engage in sports. NIKE’s Q4 revenue in China has already witnessed a 25% increase, with the potential for further acceleration as demand rises.
On its most recent close on December 19, NKE traded at $122.64 per share after gaining  1.24% in the 24-hour period, adding to a 2.84% increase in value over the past five days.

Technical analysis of NKE stock

Looking at the technical analysis, there’s evidence of the price retesting the upper band resistance of the Bollinger Bands, signaling heightened volatility in the market for the share.

The 20 and 50-day moving averages are positioned above the slower 100-day moving average, affirming the prevailing bullish momentum. However, the Stochastic oscillator has been consistently overbought since the start of December and has yet to retreat to the neutral zone.

This suggests a potential short-term correction to the downside before resuming the bullish trend.

Wall Street’s forecast for NIKE

The average 12-month price target for NKE set by Wall Street analysts is presently $127, suggesting a potential upside of 3.79% relative to the current share price.

With 20 ‘Buy’ recommendations, 9 ‘Hold’ suggestions, and no ‘Sell’ indications, the stock maintains an average analyst rating of ‘Moderate Buy.’ Projections from analysts reflect increasing optimism, with certain forecasts reaching as high as $150.

The heightened revenue growth in China is expected to positively impact overall margins, given its typically higher profitability, while keeping inventories in check, which might present investors with a potentially lucrative opportunity.

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