Nike, the most valuable listed company in the sports sector, reached its lowest level in 12 years on August 18, 2024, amid a restructuring process led by Elliot Hill, who returned as CEO in October 2024 after leaving the company in 1988. The strategy called "Win Now" has not convinced investors, who show growing impatience with the duration and complexity of the recovery process. The shares are trading around $40, well below historical levels.
Analysts consulted by Jornal Económico argue that despite the challenges, the recovery plan is not at risk. João Lampreia, a market specialist at Freedom24, considers it premature to consider "Win Now" a failure, noting that the strategy involves a gradual return to sports categories, strengthening the wholesale channel, and greater control over distribution. Henrique Valente, an analyst at ActivTrades, points out that Nike has approximately nine billion dollars in cash, which allows it to continue funding the plan without relying on issuing new shares.
The head of trading at Banco Carregosa, João Queiroz, identifies China as the main focus of concern, with regional revenues falling 23% in two years, from $7.55 billion to $5.85 billion. Simultaneously, the company faces growing competition from the On and Hoka brands in the performance running segment, and from Chinese brands Anta and Li-Ning, in addition to a more protectionist commercial environment and geopolitical tensions.
Analysts present three scenarios for the company. In the optimistic scenario, successful implementation of "Win Now" could bring the share price back to the $70 to $90 range in the medium term. In the base scenario, partial success would keep shares between $45 and $60. In the pessimistic scenario, shares could remain in the $30 to $40 range or test new lows if pressure in China intensifies and the shift to the wholesale channel does not compensate for the decline in the direct-to-consumer channel.
