Nike Shares Hit 10-Year Low As Analyst Downgrades Into Earnings

Nike shares (NYSE:NKE) have now shed 43% since the start of 2026 and are down a staggering 76% over the past five years, a collapse that has seen bears take firm charge of the narrative. That has not changed today, as Bank of America’s downgrade to Underperform, paired with a $30 price target, has intensified the selloff in Nike shares, which made a fresh 10-year low of $35.22.

Compounding the selling pressure, S&P Dow Jones Indices officially removed Nike from the S&P 100 this week (21st Sep), ending an 18-year tenure in the mega-cap benchmark and triggering forced rebalancing from index-tracking funds that added mechanical selling to an already fragile tape.

Driving The Downgrade in NKE

The BofA downgrade, authored by analyst Lorraine Hutchinson, is arguably the most consequential Wall Street call on Nike in years. Hutchinson cut her FY27 and FY28 earnings-per-share estimates by 11% and 12% to $1.43 and $1.87, respectively, and now expects negative sales growth to persist through all of fiscal 2027, pushing any meaningful top-line recovery out to fiscal 2028 at the earliest. Her FY27 EPS forecast sits 14% below the Visible Alpha consensus, suggesting the broader analyst community may still be too optimistic.

Perhaps most striking is BofA’s dividend warning: at $1.43 in projected FY27 earnings, Nike’s dividend coverage implies a payout ratio exceeding 107%, a level that raises legitimate questions about the sustainability of the current dividend without further earnings deterioration or a policy change. The firm also lowered its target price-to-earnings multiple from 22x to 16x, bringing it in line with broad retail peers rather than the premium historically afforded to Nike as a category leader.

The operational picture is equally challenging as Greater China, once the company’s most prized growth engine, saw revenue fall 17% in recent quarters, with BofA’s field research in the region pointing to weak sports demand, poor resonance for new product lines, and persistent excess channel inventory. The firm projects a further 12.6% decline in China for Q1 FY27. In North America, wholesale volumes have expanded, but retail sell-through is lagging sell-in as classic silhouettes such as the Air Force 1 and Dunks lose cultural momentum. Retailers are reportedly growing more cautious about committing to forward order books, a dynamic that could create inventory headaches further down the supply chain. The Nike Sportswear and Jordan Streetwear segments, which carry some of the company’s highest margins, have both experienced double-digit revenue declines and are expected to remain in contraction throughout FY27.

There are genuine pockets of operational progress, as Nike’s performance running category has grown by approximately $1 billion across five consecutive quarters, with the brand recapturing an estimated five percentage points of market share in North American and Western European running.

What Comes Next?

Wall Street is sharply divided heading into Nike’s Q1 FY27 earnings report next week (October 1), as Oppenheimer maintain an Outperform rating while trimming its price target to $52 from $60, pointing to early recovery signals in secondary-market tracking data for Kobe-branded products and select collaborations. Barclays held its Overweight rating with a $48 target, arguing that Nike’s recovery will follow a “margins before sales” path, meaning profitability improvements will precede a return to top-line growth. Both firms acknowledge the near-term headwinds but believe the market is pricing in an overly pessimistic scenario.

The more immediate question is whether the $30 BofA target, which implies roughly 17% additional downside from current levels, will begin to anchor market expectations ahead of earnings. Technically, Nike has broken through multiple long-term support levels, and with the S&P 100 removal removing a structural buyer from the shareholder base, the path of least resistance remains downward in the absence of a positive earnings surprise or a credible update on margin trajectory.

With the stock trading at levels last seen a decade ago, a dividend payout ratio that may soon become untenable, and its most bearish major analyst calling for further declines, Nike faces one of the most consequential stretches in its modern corporate history.