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Nike Upgraded by Argus Research to ‘Buy’

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Argus believes Nike can maintain its dominant position

Nike (NKE), the world’s largest apparel company and America’s leading sportswear brand, was upgraded by Argus Research on December 14, 2017.

Analyst John Staszak upgraded Nike from a “hold” to a “buy” rating and wrote in a client note, “Although the industry remains fiercely competitive, we expect the company to build on its dominant position through its globally recognized brand, innovative products, economies of scale and rapid growth in emerging markets.”

He added, “In the near term, we expect an accelerating U.S. economy and solid results in China to benefit earnings.”

Deutsche Bank raised Nike’s price target from $61 to $76 and maintained a “buy” rating on December 14, 2017.

Analyst Paul Trussell said, “We believe NKE’s Consumer Direct Offense, shift towards differentiated retail experiences, DTC and international focus combine to make-up the right strategy and more importantly we see a better balance of technology enhanced performance product and fashion forward but comfortable lifestyle assortment hitting the shelves of late.”

Share price movement

Nike has risen 28% year-to-date as of December 15, 2017. Like other retailers, a large part of this gain has happened in the last month. The company’s share price has surged more than 15% over the last month, driven by a number of factors. They include rating and price upgrades, general optimism for Nike after its investor presentation, and growing positive sentiment for retailers as they post better-than-expected results.

Nike has also outperformed the S&P 500 Consumer Staples Sector index and the S&P 500 index, which have risen 17% and 19.5%, respectively YTD (year-to-date).

Ratings

Nike is covered by 37 Wall Street analysts who have rated it a 2.4 on a scale of 1 for “strong buy” to 5 for “sell.” It has been recommended as a “buy” by 49% analysts, a “hold” by 46% analysts, and a “sell” by the remaining 5%.

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