HSBC Lowers Nike (NKE) Rating on Delayed Turnaround and Tariff Costs

TLDR

• HSBC downgraded Nike from “Buy” to “Hold” with a $48 price target, citing a delayed turnaround and near-term revenue declines
• NKE stock opened at $42.59, near its 52-week low of $42.36, well below its 52-week high of $80.17
• Nike faces an estimated $1.5 billion in added annual costs from US tariffs
• HSBC forecasts the global sportswear market to grow ~3.9% in 2026, but expects Nike to lose market to Adidas, On, and Arc’teryx
• Two Nike directors bought stock in early April, with Robert Holmes Swan adding 11,781 units worth ~$500,000

Nike’s stock is sitting at levels not seen in over a decade, and Wall Street is starting to reflect that reality.

NIKE, Inc., NKE

HSBC downgraded NKE from “Buy” to “Hold” on April 13, setting a price target of $48. That implies about 12.7% upside from where the stock was trading — not exactly a ringing endorsement.

The bank’s note was blunt. Nike’s turnaround is taking longer than expected. Revenue is projected to fall in the near term, and profit forecasts have been cut. Cost pressures aren’t letting up either.

NKE opened Monday at $42.59, just above its 52-week low of $42.36. The stock has lost nearly half its value from its 52-week high of $80.17. Market cap now stands at around $63 billion.

HSBC isn’t the only one pulling back. Citigroup trimmed its target from $65 to $53. Piper Sandler cut from $60 to $50. Evercore dropped from $69 to $57, though kept its “outperform” rating. Guggenheim lowered from $77 to $74 but held its “buy.” The consensus across 36 analysts is now a “Hold,” with an average target of $62.34.

Tariffs Adding Pressure

One of the bigger weights on the stock is tariff exposure. HSBC estimates Nike faces $1.5 billion in additional annual costs from US tariffs. Adidas is looking at a €200 million hit in 2026. With much of Nike’s production overseas, there’s little short-term relief in sight.

HSBC’s broader sector note flagged elevated promotions across Western markets as Nike works through its inventory backlog. In China, the picture is doubly complicated — weak macro conditions combined with stronger local competition are squeezing market share.

The sportswear market globally is expected to grow about 3.9% in 2026, with Asia-Pacific leading. But HSBC sees Nike losing ground to rivals like Adidas and newer players On and Arc’teryx.

Nike’s Q3 results, released March 31, were a modest beat. EPS came in at $0.35 versus the $0.29 consensus. Revenue hit $11.28 billion, slightly above the $11.23 billion estimate. Year-over-year revenue was up just 0.1%. For context, the same quarter last year delivered $0.54 EPS.

Insiders Are Buying

Not everyone is running. Two Nike directors bought stock in early April. Robert Holmes Swan purchased 11,781 units at $42.44, a transaction totaling roughly $500,000. His stake in the company rose 27.2%. Director John W. Rogers Jr. added 4,000 units at $43.34, a $173,360 buy that lifted his holdings by 10.8%.

Institutional ownership sits at 64.25%. Brighton Jones LLC increased its position by 388.5% in Q4 last year, adding over 160,000 units.

Analysts now expect Nike to post full-year EPS of $2.05 for the current fiscal year. The PE ratio stands at 28.21. The 50-day moving average is $56.46 and the 200-day is $62.07 — both well above where the stock is trading now.

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