Nike Stock Is Making New 52-Week Lows Today: Here's Why

Nike Inc NKE shares are trading lower Friday after the company reported fiscal first-quarter financial results showing an increase in quarter-ended inventories. Revenue in the Greater China region also fell on a year-over-year basis.

Nike said fiscal first-quarter revenue increased 4% year-over-year to $12.7 billion, which beat average analyst estimates of $12.27 billion, according to Benzinga Pro. The company said its revenue results were led by 14% growth in Nike Direct. The Nike Brand Digital business jumped 23%, driven by double-digit growth in EMEA, North America and APLA, partially offset by declines in Greater China. China revenues were down 16% year-over-year.

Nike reported quarterly earnings of 93 cents per share, which beat average estimates of 92 cents per share. Earnings were down 20% on a year-over-year basis.

Nike said total inventories jumped 44% to $9.7 billion, driven by elevated in-transit inventories from ongoing supply chain volatility, partially offset by strong consumer demand during the quarter.

"NIKE's first quarter results set the foundation for another year of strong growth," said Matthew Friend, executive vice president and CFO of Nike.

"Our focus continues to be the consumer, as we take action to navigate near-term dynamics while expanding long-term structural benefits through our Consumer Direct Acceleration strategy."

Related Link: Nike Q1 Earnings Highlights: Revenue And EPS Beat, Investors Pull Back On Inventory, China Concerns

Analyst Assessment: Several analyst adjusted price targets on the stock following the company's quarterly results.

• Citigroup analyst Paul Lejuez maintained Nike with a Neutral and lowered the price target from $113 to $93.
• RBC Capital analyst Piral Dadhania maintained Nike with an Outperform and lowered the price target from $125 to $115.
• Wedbush analyst Tom Nikic maintained Nike with an Outperform and lowered the price target from $121 to $101.
• Morgan Stanley analyst Alex Straton maintained Nike with an Overweight and lowered the price target from $129 to $120.
• BofA Securities analyst Lorraine Hutchinson maintained Nike with a Neutral and lowered the price target from $122 to $100.

NKE Price Action: Nike is making new 52-week lows on Friday.

The stock was down 12.4% at $83.40 at time of publication.

Photo: c1n3ma from Pixabay.