Nike's Sneaker Buzz And Tariff Risks Could Shape Its Future: Analyst

Needham analyst Tom Nikic reiterated a Buy rating on the shares of Nike Inc NKE with a price forecast of $75.00.

According to the analyst, monitoring collectible sneaker trends is a way to gauge broader sneaker demand. High-demand releases, those selling out quickly at launch and fetching premiums on resale sites like StockX and GOAT often indicate a strong market.

Tariffs are expected to heavily influence the footwear sector in the short term, said the analyst. With nearly all U.S. footwear being imported, current tariffs 145% on Chinese goods and 10% elsewhere pose a significant threat to profit margins.

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As a result, stock movements are likely to be driven more by evolving tariff news than business fundamentals, creating uncertainty for investors, noted the analyst.

Nike has launched the ReactX Rejuven8, a molded rubber slip-on that resembles Crocs. The shoe, featuring perforations on the upper, sold out quickly in limited quantities and is gaining traction on social media.

While it's early, the analyst suggests that if the buzz continues, the model could pose competitive pressure for Crocs Inc. CROX.

Nike received strong consumer response to its Pegasus Premium running shoe, with successful launches in both January and March.

This momentum could indicate early signs of a rebound in Nike's running category.

While it's too soon to say Nike is impacting rivals like Hoka and On Holding AG ONON, the analyst suggests it's a space worth watching.

Brand-level analysis suggests that Nike could see a year-over-year uptick in high-heat sneaker releases, partly due to last April's underwhelming Jordan lineup.

Price Action: NKE shares traded lower by 0.33% at $54.18 at last check Friday.

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