By Nigam Arora & Dr. Natasha Arora
Opportunity
There is a likely opportunity in Nike (NKE) stock for the long term investor.
Stock Decimated
NKE stock has been decimated due to falling revenues and profits for the following reasons.
- Allinating wholesalers
- Allinating retailers
- Design mistakes
- Slowing sales in China
- Ex-CEO with tech background not in tune with retail
Earnings
NKE reported earnings in line with the consensus and worse than the whisper numbers.
Turnaround
Nike (NKE) has a new CEO who is laser focused on turnaround.
The conference call was very positive. The turnaround is in progress. The company believes the sales have hit the bottom. Following the optimism generated by the conference call, the stock is up 15.76% and is currently trading at $72.40 as of this writing.
Risk
NKE still faces risks from tariffs of as much as a billion dollars.
Zones
For those following the Good Way, the Buy Now rating is *** (To see the locked content, please take a 30 day free trial) to start a small scale in.
For those following the Best Way, the buy zone is $*** – $*** to scale in.
To learn about the Good Way and the Best Way, please read The Arora Report’s Getting a Running Start Guide.
The maximum recommended quantity is ***% – ***%.
The target zone is $131 – $136.
This is a very long term position.
Catastrophic stop zone is $*** – $***.
What To Do Now
Those in NKE may consider continuing to hold. Those not in NKE may consider following the parameters given above.
Signal Limited is a Signal(s) with a great record in similar situations but does not meet all of the stringent criteria for a Signal. Typically Signal Limited has higher risk-reward compared to a Signal over the short term.
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This post was published on Friday on ZYX Buy Change Alert.
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Nigam Arora
Nigam Arora is known for his accurate stock market calls. Nigam is a distinguished master of the macro. He is a popular columnist with over 100 million page views, an engineer, and nuclear physicist by background. Nigam has founded two Inc. 500 fastest growing companies and has been involved in over 50 entrepreneurial ventures. He is the developer of Theory ZYX of Successful Change Management and is the author of the book on Theory ZYX, as well as the developer of the ZYX Change Method for Investing.
Dr. Natasha Arora
Dr. Natasha Arora has significant expertise in investment analysis especially biotech, healthcare, and technology. Natasha is a graduate of Harvard Medical School followed by a postdoc at MIT. She has published several peer reviewed research papers in top science journals.
