Nike Inc (NYSE: NKE) is not worth owning even though its shares have lost well over 10% since the start of this year, says an RBC Capital analyst.

Piral Dadhania downgraded the sportswear giant this week to “sector perform” and trimmed his price objective to $100 that suggests a 6.0% upside only.  

The analyst turned dovish on Nike stock after the management said sales in China continued to lose pace in the holiday quarter.

More importantly, the New York listed firm was quite vague in terms of guidance for its fiscal 2025. It said earnings and revenue will grow versus the previous year but did not say by how much.

Its expectation for 1.2% increase in full-year gross margins also came in shy of up to 1.6% increase that analysts had forecast. You can read the full earnings release of $NKE on this link.

Piral Dadhania took a cautious tone also because it’s currently undergoing strategic changes including organizational restructuring which may add to uncertainty for Nike stock as well.

Momentum, he added, is relatively much stronger at competitors like Adidas AG that the RBC analyst currently rates at “outperform”.  

Dadhania lowered his revenue forecast by 8.0% for 2025. He also expects a 30-bps hit to gross margin and a 2.0% decline in EBIT as well.

On the plus side, Nike shares do pay a dividend yield of 1.58% though. The RBC analyst forecasts earnings to come in at $3.44 for $NKE in fiscal 2025.

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