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Jordan, Wemby, and Why Nike’s Turnaround Hasn’t Taken Flight

Barron's Streetwise

# Full Transcript

**Podcast:** Barron's Streetwise

## Participants

- **Jack Howe** (Barron's)
- **Jay Soule** (UBS)
- **Chris Rossback** (Jay Stern)
- **Sean Go** (None)
- **Chris Chase** (Wear Testers)

## Transcript

It's going to take some time. I just think what's happening with the stock price over the last couple of years is Wall Street realizing that the turnaround and the amount of time that Nike needs to get back to being the company that people expect it to be is a lot more than what people thought, say, a year or two years ago. Hi, it's Jack Howe, and this is the Barron's Streetwise podcast. The voice you just heard, that's Jay Soule. He's an analyst at UBS. He covers footwear.

We're talking about Nike. That stock is down from a peak of over $170 a share to a recent price in the 40s. It's an opportunity to buy one of history's great growth stocks when it's way down. But the problems for Nike might run deeper than they appear. We're going to talk in this episode about why its turnaround has been elusive

and why stock buyers should be cautious until they see more signs of progress. That's next. I am wearing, at this moment, machine washable sneakers. Not that I have washed them in the machine. I don't bother because they were so cheap. They were $45. And I have a stack of boxes in my closet.

I have about, I'm going to say, like four pairs lined up for me when this pair gets dirty. They slip on. I don't have to tie laces. At first, I told myself, I'll just wear these around the house. But we're way past that now. I guess I won't tell you the brand, but it makes a statement. And that statement is, don't judge me for my fashion because I've clearly given up. I'm out of the game.

I tell you this to say that I'm not the guy to explain the finer points of where Nike is missing on shoe design. But we're going to hear from some people in a minute who can help us with that. We'll hear from a Wall Street analyst who is skeptical and a shareholder who's a believer. And we'll hear from a couple of passionate sneaker heads. Those are people who are really into sneaker culture and design and they collect sneakers. I don't think my boxes in the closet count.

Nike has had a new CEO since October 2024. His name is Elliot Hill. He's a company lifer who was brought back from retirement to set things right. But the stock has continued to decline. It was recently trading at a price that investors could have paid almost a dozen years ago. And to my eye, there are two more problems. Although the shares are cheaper, I wouldn't say they're trading in a deep and obvious discount.

They're about 24 times projected earnings for the company's fiscal year ahead. A bounce back in earnings would certainly help, but estimates for earnings in coming years have been slipping. And the second problem is that CEO Hill is really already doing the things that investors are demanding. They want the company to refocus on performance shoes after years of shuffling along o...

Jordan, Wemby, and Why Nike’s Turnaround Hasn’t Taken Flight

Transcript

Built for investment professionals

Every day you wait, your competitors are finding
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Jordan, Wemby, and Why Nike’s Turnaround Hasn’t Taken Flight

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.