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Time to Buy Nike (NKE) or Adidas (ADDYY) Stock for a Retail Rebound?
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The Zacks Shoes and Retail Apparel Industry is down -14% year to date but may be poised for a rebound as we edge closer to this year's holiday shopping season.
Among the space, Nike (NKE - Free Report) and Adidas (ADDYY - Free Report) are headline names that still command a large portion of the retail and apparel market share especially as it relates to shoes.
There may be a notion that these industry leaders could have more upside with Nike’s stock down -15% YTD and 24% from its 52-week highs while Adidas shares have rebounded nicely this year rising +32% but still 12% from its own high over the last year.
Image Source: Zacks Investment Research
Broker Recommendations & Lofty Price Targets
At the moment, Nike and Adidas stock have favorable broker recommendations. Nike’s ABR (Average Broker Recommendation) is at 1.79 on a scale of 1 to 5 (Strong Buy to Strong Sell) with the Average Zacks Price Target of $123.43 a share suggesting 25% upside from current levels.
Image Source: Zacks Investment Research
Pivoting to Adidas, its ABR is at 2.06 and the Average Zacks Price Target of $135.11 a share represents 50% upside from current levels.
Image Source: Zacks Investment Research
Earnings Estimate Revisions
The Zacks Rank is largely predicated on the trend of earnings estimate revisions which has proven to be one of the most influential catalysts to the upward price movement of stocks.
In this regard, Adidas’ stock stands out. To that point, Adidas’ fiscal 2023 earnings estimates have climbed over the last quarter as the company continues to put its inventory concerns behind it following the fallout with its fashion collaborator Kanye West.
Adidas’ FY23 earnings estimates are now expected at an adjusted loss of -$0.58 per share compared to estimates of -$1.58 a share 90 days ago. Plus, FY24 earnings estimates are still up 4% in the last 60 days to $1.93 per share.
Image Source: Zacks Investment Research
As for Nike, its bottom line remains ahead of its rival Adidas but the trend of earnings estimate revisions is less compelling. While Nike’s FY23 earnings estimates are modestly higher over the last quarter, FY24 EPS estimates have slightly declined in the last two months.
Image Source: Zacks Investment Research
Takeaway
Considering the trend of earnings estimate revisions the strong price performance in ADDYY shares could continue this year landing Adidas stock a Zacks Rank #1 (Strong Buy) at the moment while Nike’s stock lands a Zacks Rank #3 (Hold).
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Time to Buy Nike (NKE) or Adidas (ADDYY) Stock for a Retail Rebound?
The Zacks Shoes and Retail Apparel Industry is down -14% year to date but may be poised for a rebound as we edge closer to this year's holiday shopping season.
Among the space, Nike (NKE - Free Report) and Adidas (ADDYY - Free Report) are headline names that still command a large portion of the retail and apparel market share especially as it relates to shoes.
There may be a notion that these industry leaders could have more upside with Nike’s stock down -15% YTD and 24% from its 52-week highs while Adidas shares have rebounded nicely this year rising +32% but still 12% from its own high over the last year.
Image Source: Zacks Investment Research
Broker Recommendations & Lofty Price Targets
At the moment, Nike and Adidas stock have favorable broker recommendations. Nike’s ABR (Average Broker Recommendation) is at 1.79 on a scale of 1 to 5 (Strong Buy to Strong Sell) with the Average Zacks Price Target of $123.43 a share suggesting 25% upside from current levels.
Image Source: Zacks Investment Research
Pivoting to Adidas, its ABR is at 2.06 and the Average Zacks Price Target of $135.11 a share represents 50% upside from current levels.
Image Source: Zacks Investment Research
Earnings Estimate Revisions
The Zacks Rank is largely predicated on the trend of earnings estimate revisions which has proven to be one of the most influential catalysts to the upward price movement of stocks.
In this regard, Adidas’ stock stands out. To that point, Adidas’ fiscal 2023 earnings estimates have climbed over the last quarter as the company continues to put its inventory concerns behind it following the fallout with its fashion collaborator Kanye West.
Adidas’ FY23 earnings estimates are now expected at an adjusted loss of -$0.58 per share compared to estimates of -$1.58 a share 90 days ago. Plus, FY24 earnings estimates are still up 4% in the last 60 days to $1.93 per share.
Image Source: Zacks Investment Research
As for Nike, its bottom line remains ahead of its rival Adidas but the trend of earnings estimate revisions is less compelling. While Nike’s FY23 earnings estimates are modestly higher over the last quarter, FY24 EPS estimates have slightly declined in the last two months.
Image Source: Zacks Investment Research
Takeaway
Considering the trend of earnings estimate revisions the strong price performance in ADDYY shares could continue this year landing Adidas stock a Zacks Rank #1 (Strong Buy) at the moment while Nike’s stock lands a Zacks Rank #3 (Hold).