BUZZ - Nike's "Just Do It" mission is tougher than expected

October 2 - ** As Nike NKE.N faces mounting challenges in the Chinese market, the company is deepening its restructuring under CEO Elliott Hill (link). Previously, the sportswear giant had forecast an unexpectedly sharp decline in full-year revenue and announced an additional round of layoffs and plans to reorganize its global business units.

** Shares fell nearly 9% in pre-market trading to $32.06

Severe challenges

** Morgan Stanley (rating: "Underweight", target price: $27) pointed out that Nike must leverage advantages from the World Cup and its high-performance product line; below-expected wholesale sales trends may persist, leading to inventory build-ups that exceed management's order forecasts

** RBC Capital Markets (rating: "Sector Perform", target price: $40) said "things will get worse before they get better," as management indicated that the impact of streamlining measures will extend to fiscal 2028, and the problems with Jordan, sportswear, and Greater China appear more severe than expected

** BTIG ("Buy", target price: $50) expects that Nike sportswear, the Jordan brand, and Greater China will continue to face pressure, with the situation in Greater China deteriorating since the first quarter

** Oppenheimer ("Outperform") stated it still has concerns that Nike (NKE)'s successful repositioning will take time and that there could be further "growing pains" in the short term

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