Investing.com - Nike ’s (NYSE:NKE) sales are likely to face pressure in the 2026 fiscal year as the sports apparel company ramps down some major franchises, according to analysts at Citi.
In a note to clients downgrading their rating of the stock to "neutral" from "buy", the analysts said they do not see Nike rolling out "enough new product" at a large enough scale to make up for this trend.
Earnings may also see headwinds, with management flagging the need for investment to boost demand, they noted.
As a result, the analysts said they do not believe the 2026 financial year will "inflect the way" they had initially hoped, "either on the sales or [earnings before interest and taxes] margin line."
They added that they "no longer have the patience or conviction to wait another year" for a positive upswing in Nike’s fortunes. The Oregon-based group has been racing to regain its dominance of the sportswear market as it grapples with intensifying competition.
CEO Elliott Hill has previously outlined plans to refocus the business on sport and selling items at high-end prices, saying Nike has become "far too promotional." But Hill has warned that the turnaround efforts would dent returns in the short-term. In December, Nike unveiled a tepid revenue in its third quarter, predicting sales would slide in the low double-digit percentages.
The Citi analysts argued that the consensus estimates for earnings per share in Nike’s 2026 fiscal year are "too high," adding that this is making the timing of returns from the overhaul of the firm "much less visible."
"It sounds like another down sales year in [fiscal 2026]," the analysts wrote.
Shares in Nike have slipped by more than 30% over the past one-year period.