Morningstar cuts Nike forecasts and lowers its moat rating
Morningstar still sees Nike shares as undervalued, but trimmed sales, margin and China growth forecasts amid rising competition from rivals.
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what happened
According to Stocktwits, Morningstar analyst David Swartz lowered Nike's economic moat rating to narrow from wide, while saying the shares remain undervalued. Newer rivals, including Deckers' Hoka brand and On Holding, are pressing Nike's lead in performance footwear, and its share of the U.S. sports shoe market fell to 30% in 2025 from 40% in 2016.
Morningstar now expects fiscal 2027 sales to decline 8%, versus its earlier 2% drop, and cut EPS estimates to $1.16 from $1.69. Its ten-year sales growth forecast fell to 3% from 5%, and China growth to 1% from 9%. Nike plans $2.5 billion in savings over four years, with part of it redirected to product development and marketing.
why it matters
For investors, the cut to revenue and margin forecasts matters, even as the analyst still expects a recovery. Shares are down more than 41% year to date, and risks from consumer demand, tariffs and China remain elevated.
market impact
Nike and sportswear peers: lower forecasts and rising competition weigh on the company's shares
tags
instruments
sources
- NKE Stock Wrapped Its Best Week In 3 Months: Analyst Says Nike Will Recover From ‘Lackluster Product Development,’ Shares Undervalued — Stocktwits, 19 October 2026 at 08:55 UTC
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