The sneaker market is as hot as ever, and Wall Street is taking notice.
Nike’s share price soared to a high of $87.99 on Monday morning, hitting a new record before slipping slightly in afternoon trading. The sportswear giant is still riding high off its December earnings announcement, in which it reported double-digit sales growth and revenues of $9.4 billion, easily beating expectations. The company also presented an upbeat forecast for the year to come, including faster speed to market, improved gross margin and a turnaround at Jordan Brand.
Despite the recent drama surrounding the Zion Williamson shoe explosion incident — in which the freshman Duke basketball player’s Nike sneaker split open on the court during a game — the company’s stock price has held strong, swelling 17 percent since January.
Nike was the third-best-performing Dow stock of 2018, and a Friday rally helped push the index to its tenth straight week of gains. The company owed its end-of-week boost largely to Foot Locker, which crushed Wall Street’s estimates with its fourth-quarter earnings release, posting a 9.7 percent increase in comparable-store sales and profits of $158 million.
The retailer’s success underlines the strength of the athletic market even as department stores and other multibrand chains see mixed results.
With its latest gains, Nike’s stock price is now moving closer to (and in some cases surpassing) the goalposts set by many analysts.
At Canaccord Genuity, Camilo Lyon reiterated his $95 price target in a December note, writing, “As we look to the second half of fiscal 2019 and beyond, we are confident that Nike’s robust product pipeline — coupled with an intensifying focus on digital, increasing scale of Express Lane and elevated customer experience at retail — will continue to deliver outsized growth across all the key growth catalysts well beyond fiscal 2019.”
Since August, nine analysts have upgraded the stock, while only one has downgraded it — to neutral, from buy.
Nike will report fiscal third-quarter earnings on Mar. 21.