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Nike shares will do well as the athletic apparel brand refreshes its product offerings and organizational structure, RBC told clients on Thursday. The bank upgraded Nike to outperform from sector perform. It raised the stock’s price target to $90 from $76, implying 24% upside. RBC pointed to Nike CEO Elliott Hill’s overhaul this year of the company’s organizational structure as a major catalyst for growth moving forward. The firm’s senior leadership is largely composed of newly appointed members or individuals in newly created roles, which should help Nike chart a new path. “Nike is taking the right steps, with clear improvement in Running Footwear offer, positive channel checks, survey findings and a refreshed organisational structure (SLT) that should support faster and more accountable decision-making,” analyst Piral Dadhania said in the note. NKE YTD mountain NKE year to date. On the product side, Nike plans to debut 26 running sneakers through the end of next year, or more than any of its peers, RBC said. The footwear giant also aims to roll out more sports products, including a line of apparel designed with the Nike FlyWeb and Radical AirFlow materials, the analysts said. “With a more commercial line-up that has sufficient distinction in use case and aesthetic, Nike should be in a better position to engage with retail partners,” Dadhania wrote. That refreshed lineup could help Nike increase its distribution and shelf space across retailers, which may boost sales. RBC’s call marks one of 19 buy or strong buy ratings for Nike, according to LSEG data. Wall Street is largely split on the company’s rating, with nearly half of all analysts advising investors to hold the stock. Nike shares rose nearly 2% following the upgrade. However, the company’s stock remains down roughly 2% over the year to date.
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