The recent run-up in the market would make it easy to justify selling any stock these days. Yet, while panic never helps investors, it's still a good idea to play devil's advocate with investments.
Here at The Motley Fool, we like to consider both the good and the bad sides of an investment, so in this article, I'm highlighting three of the main bearish arguments on Nike. Be sure to read the bullish side as well, and then weigh in with your own comments below or rate Nike in CAPS.
1. Cautious recovery
Despite recently improved consumer spending that yielded an increase in same-store sales at some stores like Costco
2. No longer a bargain
Nike may have been building some momentum lately, but the roughly 50% price increase in the past year, pushing shares to all-time highs recently, means the stock isn't sitting in bargain territory. There's still uncertainty about the global economy, and Nike's shares are above pre-recession levels, so some investors could be reconsidering their positions.
3. Past its prime
Nike's market capitalization is already many times the size of upstart brands like Under Armour
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Fool contributor Dave Mock has Nike running shoes; oddly, he doesn't feel as good as those pro athletes look when he wears them. He doesn't own shares of companies mentioned here. Costco Wholesale and Wal-Mart Stores are Motley Fool Inside Value recommendations. Under Armour is a Rule Breakers selection. Costco Wholesale is a Stock Advisor pick. Under Armour is a Motley Fool Hidden Gems choice. The Fool owns shares of Costco Wholesale and Under Armour. The Fool's disclosure policy is rolling for million-dollar endorsements, but no luck so far.