Avoid Nike Due to Margin and Competitive Concerns

23 days ago

Brett Schaefer / Ryan Henderson

"I think it's an easy pass for investors. It takes strong brand management, and if you look at Nike, with their stagnant growth and margin pressure, you're not getting paid for the risk."

The speakers discuss Nikes earnings report and long-term prospects, pointing out that constant currency revenue growth has been near flat and margins are under pressure due to heavy discounting. They highlight loss of market share in footwear to competitors like On Running and Hoka, and conclude that Nike, with its high valuation and large market cap, is an unattractive long-term buy compared to leaner names like Lululemon.

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