Selected stock price target news of the day - June 28th, 2024

By: Matthew Otto

Nike Faces Sales Decline and Strategic Challenges Amidst Market Turbulence

Nike reported a fiscal 2024 fourth-quarter revenue of $12.61 billion, missing the consensus estimate of $12.84 billion. However, earnings exceeded expectations with an adjusted EPS of $1.01, compared to the anticipated $0.83. Nike Digital experienced a 10% decline for the quarter due to softer traffic, higher promotions, and lower sales of footwear franchises.

Regionally, North American sales were $5.28 billion, falling short of the $5.45 billion expected. Europe, the Middle East, and Africa reported $3.29 billion, below the $3.32 billion estimate, while Asia Pacific and Latin America reached $1.71 billion, missing the projected $1.77 billion. Sales in China exceeded expectations at $1.86 billion, but the outlook remains uncertain. Converse saw an 18% revenue drop to $480 million, and direct sales fell 8% to $5.1 billion, while wholesale revenue rose 5% to $7.1 billion.

Nike forecasted a mid-single-digit percentage decline in fiscal 2025 revenue, driven by reduced demand as consumers favor newer brands like On and Hoka. Nike also cut its full-year guidance, expecting a 10% sales decline in the current quarter, compared to analysts’ expectations of a 3.16% drop.

To combat declining sales, Nike is investing in new running shoes and planning a fresh iteration of the Air Max line. However, GlobalData analyst Neil Saunders commented, “Nike is trying to sell a narrative that it’s reinventing, but the numbers they have given for 2025 really suggest a company that’s in a bit of trouble, and the things they’re doing just are not going to deliver across next year.”

Analyst Downgrades Over Sales Concerns: Price Targets Cut

JP Morgan analyst Matthew Boss Downgraded Nike from Overweight to Neutral and the price target from $116 to $83.
Truist Securities analyst Joseph Civello Maintained Hold rating but lowered the price target from $99 to $81.
BMO Capital analyst Simeon Siegel Maintained Outperform rating and lowered price target from $118 to $100.
Wedbush analyst Tom Nikic Reiterated Outperform rating yet lowered the price target from $115 to $97.
Telsey Advisory Group analyst Cristina Fernandez Maintained Outperform rating and lowered price target from $115 to $100.
Oppenheimer analyst Brian Nagel Kept Outperform rating and a $120 price target.
TD Cowen analyst John Kernan Maintained Hold rating and lowered price target from $89 to $75.
Baird analyst Jonathan Komp Maintained Outperform rating and lowered the price target from $125 to $100.
Evercore ISI Group analyst Michael Binetti Maintained Outperform rating but lowered the price target from $110 to $105.
Stifel analyst Jim Duffy Downgraded from Buy to Hold and the price target from $117 to $88.
Morgan Stanley analyst Alex Straton Downgraded from Overweight to Equal-Weight and the price target from $114 to $79.

Which Analyst has the best track record to show on NKE?

Analyst Piral Dadhania (RBC) currently has the highest performing score on NKE with 7/11 (63.64%) price target fulfillment ratio. His price targets carry an average of $6.14 (6.54%) potential upside. NIKE stock price reaches these price targets on average within 57 days.

General Mills Fiscal Year 2024: Earnings Beat Expectations, But Revenue Misses Amid Economic Headwinds

General Mills concluded its fiscal year 2024 with an adjusted earnings per share reporting $1.01 for the fourth quarter, slightly above the analyst consensus of $1.00. However, revenue fell to $4.71 billion, marking a 6% decline from the same period last year and missing analysts’ expectations of $4.86 billion. This revenue shortfall was driven by a 2-percentage-point decrease in transaction volume and a 4-percentage-point decline in average product prices.

Net sales is reported to decrease to $19.9 billion, alongside stagnant organic net sales which were down 1 percent from the previous year’s growth. Despite these headwinds, General Mills managed to bolster its gross margin by 230 basis points to 34.9 percent. Operating profit held steady at $3.4 billion, as higher gross profit dollars offset increased input costs and supply chain challenges.

Looking forward to fiscal 2025, General Mills anticipates organic net sales to range between flat and a modest 1% growth, aiming to bolster its market position through intensified brand-building efforts and strategic investments in innovation. General Mills plans to achieve cost savings equivalent to 4-5% of cost of goods sold under its Holistic Margin Management program, surpassing expected input cost inflation of 3-4%. These initiatives are designed to support adjusted operating profit, projected to range between a 2% decline and flat in constant currency from the $3.6 billion reported in fiscal 2024. Adjusted diluted EPS is expected to range between a 1% decline and a 1% increase from the $4.52 earned in fiscal 2024.

Analysts Maintain Cautious Outlook, Lower Price Targets

Evercore ISI Group analyst David Palmer maintained an In-Line rating but lowered the price target from $76 to $72.
BofA Securities analyst Bryan Spillane maintained a Neutral rating and lowered the price target from $70 to $68.
Citigroup analyst Thomas Palmer reiterated a Neutral rating yet lowered the price target from $71 to $68.
Wells Fargo analyst Chris Carey reiterated an Equal-Weight rating and lowered the price target from $70 to $67.
RBC Capital analyst Nik Modi reiterated a Sector Perform rating and a $70 price target.
JP Morgan analyst Ken Goldman maintained a Neutral rating and lowered the price target from $70 to $63.

Which Analyst has the best track record to show on GIS?

Analyst Alexia Howard (BERNSTEIN) currently has the highest performing score on GIS with 5/5 (100%) price target fulfillment ratio. Her price targets carry an average of $0.17 (0.24%) potential upside. General Mills stock price reaches these price targets on average within 77 days.

Levi Strauss Q2 FY2024 Earnings Report: EPS Beats, Revenue Slightly Misses; Affirms FY Guidance

Levi Strauss & Co. announced its second-quarter fiscal 2024 results, reporting earnings per share of $0.16 exceeding the analyst consensus of $0.11. However, revenue for the quarter was $1.44 billion, lower than the expected $1.45 billion.

Gross margins soared 60.5%, up 180 basis points year-over-year. DTC revenue grows 11% globally and e-commerce up 19%. Operating margins improved across key markets, with the Americas achieving 18% driven by DTC performance and improved wholesale trends. Europe saw a 420 basis points increase in gross margins, while Asia maintained an operating margin of 13%.

Looking ahead, Levi Strauss reaffirmed its full-year fiscal 2024 guidance, expecting EPS in the range of $1.17 to $1.27, below the consensus estimate of $1.27. Anticipates reported net revenues to grow by 1% to 3% year-over-year, despite facing headwinds from foreign exchange impacts.

Analysts Mixed Ratings Reflect Divergent Price Target Adjustments

BofA Securities analyst Christopher Nardone maintained a Neutral rating and raised the price target from $19 to $22.
JP Morgan analyst Matthew Boss maintained a Neutral rating and lowered the price target from $21 to $20.
Telsey Advisory Group analyst Dana Telsey maintained an Outperform rating and a $26 price target.

Which Analyst has the best track record to show on LEVI?

Analyst Ike Boruchow (WELLS FARGO) currently has the highest performing score on LEVI with 8/10 (80%) price target fulfillment ratio. His price targets carry an average of $1.34 (7.18%) potential upside. Levi Strauss & Co. Holdings stock price reaches these price targets on average within 265 days.