Baird Is Long Nike; Revenue Could Ramp Back Up In 2017

Baird's Jonathan Komp reiterated Nike Inc (NYSE: NKE)'s Overweight rating with a $70 price target. The reiteration came after Nike's most valuable athlete, LeBron James, won the NBA finals.

The analyst disagreed with Nike's recent downtrend. "We think the nearly ~25 percent correction in Nike's valuation is discounting an overly negative scenario related to the near-term outlook," stated Komp. The Baird analyst expected future revenue growth to reaccelerate during FY2017, given healthy brand fundamentals.

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Komp believes much of the accelerating revenue streams would come from a revival in basketball trends, an initiative that would support "more positive sentiment and a higher stock price," said the analyst.

Due to the great benefits Komp expects, he believes Nike shares "should be bought during periods of controversy." With nearly a 25 percent correction continuing, Komp believes Nike shares provide a great buying opportunity.

At time of writing, Nike shares were essentially flat on the day, trading down 0.08 percent off the day's $55.00 open.