Goldman Sachs Suggests Buying Put Spreads on NIKE, Inc.

Goldman Sachs is out with a research note this morning, where it suggests that traders buy put spreads on NIKE, Inc. NKE to hedge margin risk. Goldman Sachs retail analyst Michelle Tan rates NKE shares Neutral and sees modest upside to her $85 12 month price target on shares. While NKE should benefit from a rebound in US athletic sales already witnessed by adidas, Under Armor, and Foot Locker this quarter, she sees optimism already priced into NKE shares. She is concerned that Street margin assumptions are not conservative enough and could be at risk when the company issues FY2012 guidance this quarter. Goldman suggests buying the August $82.50/77.50 put spread for $1.43. NIKE, Inc. is engaged in design, development and marketing of footwear, apparel, equipment and accessory products. It is a seller of athletic footwear and athletic apparel in the world. It sells its products to retail accounts, through NIKE-owned retail, including stores and Internet sales, and through a mix of independent distributors and licensees, in over 170 countries around the world.