Nike (NKE - Free Report) is set to release its third quarter fiscal 2020 financial results after the closing bell on Tuesday, March 24. The sportswear giant will take center stage, as Wall Street and investors try to better understand how the spread of the coronavirus will impact consumers and the economy.
Nike joined Apple (AAPL - Free Report) , Lululemon (LULU - Free Report) , and many other retailers when it closed stores around the world in an effort to combat the spread of the novel coronavirus. “We have decided to close our stores in multiple countries around the world including in the United States, Canada, Western Europe, Australia and New Zealand to limit the spread of the Coronavirus (COVID-19). These closures will go into effect from Monday, March 16 through Friday, March 27,” Nike wrote in a press release.
Consumers can still shop online and Nike has expanded its digital commerce offerings in recent years through apps and more. But while the likes of Amazon (AMZN - Free Report) and Walmart (WMT - Free Report) see an uptick in deliveries, as people shop for essentials online, it remains to be seen what kind of demand there will be for expensive sneakers.
Our Zacks estimates call for Nike’s Q3 sales to climb 2.7%, far below Q2’s 10% growth and Q1’s 7%. Meanwhile, Nike’s adjusted Q3 EPS figure is projected to fall roughly 15% to $0.58 a share. On top of that, Nike’s earnings revision activity has turned completely negative recently. This helps it earn a Zacks Rank #4 (Sell).
Nike stock fell roughly 7% Monday to hover near $62 per share. This downturn is part of a larger 35% decline in the last month that has Nike trading where it was in late 2017.
Nike’s Q3 report won’t show the store closures in the U.S., but it will likely help highlight China’s impact. Perhaps most importantly, investors need to pay close attention to Nike’s guidance for any and all coronavirus impact updates.
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