Nike’s stock bounces off lows after analysts rush to its defense

Nike Inc. shares dropped Wednesday, as the sports apparel giant’s latest results failed to meet investors’ lofty expectations, but they bounced sharply off their lows after Wall Street analysts rushed to the company’s defense. The Beaverton, Ore. company reported late Tuesday improved profits and sales for its third quarter, but the stock dropped sharply as revenue missed expectations. Nike even had success in China, while many other consumer retailers struggled in the region. Also see: Nike revenue, profit climb; shares slip The stock NKE, +0.41% was down 2.3% in midday trade Wednesday, but had been down as much as 5.8% earlier in the session. It was still the biggest percentage decliner among Dow Jones Industrial Average DJIA, +0.45% components. Analysts defended Nike’s performance, however, saying they believed the company was well-positioned for long-term success. “We are buyers of the stock on any pullback and continue to believe [Nike] is one of the best growth stories in consumer,” wrote Scott Krasik, an analyst for The Buckingham Research Group. Krasik said that despite the high expectations placed on Nike, the company has performed well. Nike shares had soared 11% in two weeks through Tuesday, while the Dow gained 3.4% over the same time. Since Nike’s stock closed at a five-month low of $55.04 on Feb. 8, it had run up 18%. Many analysts were impressed with the turnaround in Nike’s management of inventories in North America, which came in below expectations, as investments made in supply-chain capacity helped boost product flow to consumers. Analysts defended Nike’s performance, however, saying they believed the company was well-positioned for long-term success. “We are buyers of the stock on any pullback and continue to believe [Nike] is one of the best growth stories in consumer,” wrote Scott Krasik, an analyst for The Buckingham Research Group. Krasik said that despite the high expectations placed on Nike, the company has performed well. Nike shares had soared 11% in two weeks through Tuesday, while the Dow gained 3.4% over the same time. Since Nike’s stock closed at a five-month low of $55.04 on Feb. 8, it had run up 18%. une paire de nike