Nike shares fell by 0.06% on Thursday ahead of the release of the company’s fourth-quarter earnings report. This change sees the sports apparel company’s stock fall 6% for the year to date.
Analysts largely cut their price targets on Nike shares in recent weeks after several wholesalers of the athletic apparel brand warned of a downturn in consumer spending.
Bloomberg consensus estimates have Nike earning revenue of $12.59 billion for the quarter. Adjusted earnings per share are expected to be $0.67, bringing the gross margin estimate to 43.5%.
Nike has been building a growth strategy based on its direct-to-consumer business. The company saw a 17% rise in revenue from the previous year last quarter, with direct-to-consumer revenue comprising 42% of its total revenue during the period.
Still, the company continues to expand its wholesale partnerships, with reports earlier this month that the company’s products will return to DSW and Macy’s.
“Investors are worried that this is a reversal in Nike’s shift from wholesale to DTC, but we don’t think the strategy is broken,” a Bank of America research analyst observed. “We expect to hear an explanation of these moves on the conf call rather than an about-face on its focus on reducing undifferentiated wholesale.”