Nike downgraded on global demand slowing in future
Nike (NYSE: NKE) was downgraded by a Banc of America Securities analyst on concerns of softening global demand.
Analyst Camilo Lyon said in a note that trends in the past two months, such as a recessionary state in Western Europe, post-Olympic inventory buildup in China and a changing economy in Latin America, point to a larger global slowdown in demand. The impact would be too much to overcome and shifted Nike's rating from "buy" to "neutral," Lyon added.
Nike has a solid balance sheet and strong free cash flow, Lyon wrote, but changing global demand will constrain Nike's growth into the 2010 fiscal year and shares will languish for the next several quarters.
Shares of Nike fell $2.44, or 4.6 percent, to close at $50.50 on Dec. 10.
--Compiled by Wendy Geister
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