Down 69%, Nike Is a Brilliant Stock to Buy Only if You Believe 1 Thing

Core Viewpoint - Nike is facing significant challenges despite its strong brand presence and product innovation, leading to a substantial decline in stock value, which may present a buying opportunity if future earnings per share (EPS) growth is anticipated [2][4][10] Financial Performance - Nike's stock is currently trading 69% below its record high, with a price-to-earnings (P/E) ratio of 18.1, the lowest in a decade, indicating investor caution [2][3] - The company reported $11.3 billion in sales for Q3 2025, a 9$48 billion in revenue, showcasing its market leadership despite current struggles [9] Market Position and Strategy - Nike has struggled to launch new products and has prioritized digital sales over third-party retail partnerships, which may have contributed to its declining revenue [5] - The company faces additional challenges from tariffs on products manufactured in Vietnam, China, and Indonesia, potentially impacting profit margins and consumer prices [6] Future Outlook - Analysts project EPS to grow at a compound annual rate of 15% from fiscal 2025 to fiscal 2027, with hopes for continued double-digit gains thereafter [8] - The company's leadership anticipates stabilization after Q4 2025, but predicting the bottom for EPS remains difficult [7] - The potential for a turnaround hinges on management's ability to enhance brand visibility, introduce exciting new products, and balance wholesale and direct distribution channels [10]