Nike Shares Face Divergent Analyst Views Amid Margin Concerns

The investment case for Nike Inc. is presenting a stark contrast in perspectives as the week concludes. While a major Scandinavian pension fund has trimmed its stake and Barclays sees limited near-term upside, Jefferies has reiterated a significantly more bullish price target. The core debate centers on whether strong earnings figures can outweigh growing margin pressure and competitive threats.

Recent regulatory filings reveal that Sweden's Fjärde AP Fonden, a substantial pension fund, has slightly reduced its position in the sportswear giant. The fund sold approximately 3.1% of its holdings, equating to nearly 10,000 shares. It retains a significant investment with over 302,000 shares valued at about $21.1 million, but the move signals a deliberate step towards risk reduction following a period of heightened volatility.

This cautious institutional move coincides with a reaffirmed neutral stance from Barclays. The bank maintained its "Equal Weight" rating—broadly equivalent to a "Hold"—accompanied by a $64 price target. With Nike's stock trading around $64.59, this implies virtually no expected appreciation from Barclays' viewpoint.

In sharp contrast, analysts at Jefferies have reinforced a far more optimistic outlook. The firm recently confirmed its "Buy" recommendation and established a price target of $110. This projection suggests a potential surge of more than 70%, highlighting a profound professional disagreement on the stock's trajectory.

Profitability Challenges Overshadow Earnings Beat

The newfound caution stems from Nike's latest quarterly report. For Q2 of its fiscal 2026, released on December 18, the company delivered earnings per share of $0.53, comfortably surpassing the consensus estimate of $0.37. On the surface, this represented an operational success.

However, a significant decline in profitability is tempering enthusiasm. The gross margin contracted by roughly 300 basis points, a substantial drop viewed by the market as a serious warning sign. It indicates that rising costs, increased discounting, or an unfavorable product mix are eroding earnings, a concern that is dampening investor sentiment as the new year begins.

Should investors sell immediately? Or is it worth buying Nike?

This skepticism is compounded by a shifting competitive landscape. Adidas received a reiterated "Buy" rating from UBS today, with a price target of 256 euros, citing strong product momentum. Furthermore, Puma is the subject of takeover speculation linked to Anta Sports. These developments suggest that capital within the athletic apparel sector may currently be favoring European rivals, which are perceived to have stronger near-term momentum.

Valuation, Price Action, and Consensus Outlook

The current stock price reflects this complex backdrop. Trading near $64.59 per share, Nike sits well below its 52-week high of $77.71, though it remains notably above its yearly low of $47.03. The shares have recovered approximately 15% over the past 30 days, yet they continue to trade far from previous peaks.

Despite near-term concerns, the overall analyst consensus remains favorable. Of the 22 experts providing official coverage on Nike over the last three months, 15 advocate a "Buy," while 7 recommend "Hold." None currently advise selling. The average 12-month price target stands at $76.58, implying a theoretical upside of about 18.5% from current levels.

This creates a direct clash between short-term prudence and longer-term confidence: a major fund is scaling back, one bank foresees stagnation, yet Jefferies and the broader analyst community continue to identify opportunity.

Technical Levels and Forward Path

From a chart perspective, Nike is navigating a critical technical area. Many market participants view the $62 to $64 range as a crucial support zone. A sustained hold above this level would keep the recent recovery trend intact, whereas a decisive break below could significantly darken the technical picture.

No immediate catalysts, such as an impending earnings report, are scheduled for the coming weeks. Consequently, the stock's direction will likely be determined by two primary factors: the capital flows of major institutional investors—as exemplified by Fjärde AP Fonden's activity—and whether the cautious "Hold" camp or the more bullish "Buy" proponents gain the upper hand. For now, Nike shares remain caught between solid fundamental performance and palpable margin risk.