Bernstein has maintained its 'outperform' rating on Nike, signalling confidence in the sportswear giant's ongoing turnaround efforts. The US-listed shares, which trade on the New York Stock Exchange, have been under scrutiny as the company works to reinvigorate growth after a period of sluggish sales and elevated inventories.
In a note to clients, Bernstein analysts acknowledged that while challenges remain — particularly in key markets such as North America and China — Nike's management is making tangible progress on clearing excess stock and revitalising its product pipeline. The firm stopped short of upgrading its price target but noted that the risk-reward balance now appears more favourable for long-term investors.
Nike's stock has fallen roughly 12 per cent year-to-date in 2026, underperforming the broader S&P 500. The company has been navigating a post-pandemic demand normalisation, with consumers shifting spending towards experiences and away from discretionary goods. However, recent quarterly results showed a modest improvement in gross margins, partly driven by tighter inventory controls and reduced discounting.
For UK investors with exposure to US equities through pension funds or ISA portfolios, Nike's performance is relevant given its weight in global consumer discretionary indices. The FTSE 100, meanwhile, edged 0.3 per cent higher on Friday to 8,245 points, with defensive sectors such as healthcare and utilities leading gains, while retail-linked stocks remained subdued amid ongoing cost-of-living concerns.
Analysts at Bernstein added that Nike's renewed focus on direct-to-consumer sales and investment in key sporting events, including the 2026 FIFA World Cup, could provide a catalyst in the second half of the year. They cautioned, however, that any recovery will likely be gradual and dependent on sustained consumer spending in the US and Europe.