Investors often wish they could go back and buy a top growth stock at the price it was at many years ago. With Nike (NKE +1.74%) stock, you have that opportunity today. It's trading at the levels it was at in 2017.
The only problem is that the economy is much different today than it was back then, and there's more competition. In 2026 and beyond, there are many more question marks around the business. But with this still being a top footwear and apparel brand, has Nike's stock fallen so much in recent years that it's effectively become a no-brainer buy?
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Nike's business faces many obstacles ahead
In the Fall of 2024, Nike announced Elliott Hill would be its new CEO. Hill is a longtime veteran of the business who has been with the company for decades. Hill's goal has been to reconnect with Nike's partners and build stronger relationships, which would also hopefully help improve the apparel company's growth in the process.
While many people point to the previous CEO's mistake of focusing too much on the direct-to-consumer market as a key reason for the company's struggles, that may be an oversimplification of the issues at hand. Consumers are shopping more online since the pandemic, and there is greater competition, both domestically and overseas. On top of all this, inflation has been a factor for multiple years -- paying a premium for the company's high-priced apparel and footwear just isn't practical for people trying to keep their costs down.
The hard truth is there in plain sight on the company's earnings report. Over the six-month period ending Nov. 30, 2025, its revenue was up just 1%, and cost of sales rose by 6%. Profits were down 31% even as the company spent more on demand creation. Even under Hill, the company has continued to struggle, proving that it's not an easy path ahead for the business.
NYSE: NKE
Key Data Points
The stock may look cheap, but that doesn't mean it's a deal
In the past five years, Nike's shares have cratered a whopping 61% in value. Today, the stock trades at 30 times earnings, and that falls to a forward price-to-earnings multiple of 20, which is based on analyst expectations. But those expectations may change if analysts don't see enough progress from the company's turnaround efforts.
Nike may have an iconic brand, but it needs much more than that to convince investors that it's still a good growth stock to buy. Even at a reduced multiple, I wouldn't take a chance on the stock today. Turnarounds can take a long time, and there's no guarantee that Nike's business will dominate the market as it once did. Taking a wait-and-see approach is the most prudent option for investors given just how much uncertainty still hovers around the shoe stock.
