RBC Capital analysts cut the firm's price target on Nike (NYSE:NKE) to $138 from $145 per share, maintaining an Outperform rating on the stock ahead of the sportswear giant's earnings release.
The analysts believe Nike's equity setup heading into its upcoming earnings is mixed.
"Share price performance has been soft (-9% L3M vs +9% sector), and sentiment is muted given US exposure, elevated inventories, and benign China reopening," they wrote.
"Against this, we view consensus forecasts as realistic, and on a relative basis Nike growth momentum, progress on inventory clearance and brand heat are amongst the strongest in the sector."
RBC believes Nike's FY24E guidance and gross margin recovery potential and EPS outcome above/below $4 "seems to be the buy-side bar." The firm reduced its FY24E revenues/EPS for the company by 4%/5%.
Nike shares are down around 0.6% premarket, near the $112.20 mark.