Latest news with #turnaround
Globe and Mail
16 hours ago
- Business
- Globe and Mail
NIKE's Inventory Cleanup Continues: Is it Too Little, Too Late?
NIKE Inc. 's NKE ongoing efforts to streamline inventory and reset the marketplace remain central to its turnaround strategy. However, concerns linger about whether these moves are coming too late to reverse the broader slowdown in growth. In fourth-quarter fiscal 2025, revenues dropped nearly 12% year over year, while inventory remained flat, signaling that while progress has been made, excess stock still weighs heavily on the business. The company has aggressively discounted aging products like Air Force 1, Dunk and AJ1 through value channels, but its digital business continues to struggle with weak traffic and ongoing promotions. To regain control, NIKE is pursuing a phased inventory reset. It expects to reach a 'healthy and clean' inventory position by the end of the first half of fiscal 2026. That means more discounting in the near term and continued pressure on digital traffic, which was down 26% in the fiscal fourth quarter. In key regions like North America and EMEA, the inventory quality is improving, with better sell-through rates and growing full-price sales. However, markets like Greater China still lag, requiring deeper discounting, supply cuts and retail concept overhauls. While NIKE maintains that its inventory cleanup is on track, some analysts are skeptical. Ongoing reliance on markdowns and value channels risks brand dilution and weakens long-term consumer perception. With a $1 billion tariff headwind looming, any misstep in inventory or pricing could further delay the path to profitable growth. Success now hinges on the company's ability to clear aging stock while reigniting demand for new, full-price products. NKE's Competition in the Global Arena adidas AG ADDYY and lululemon athletica inc. LULU are the key companies competing with NIKE in the global market. adidas has made notable progress in normalizing its inventory after being weighed down by excess stock, particularly from discontinued Yeezy products. In its recent earnings reports, the company highlighted double-digit declines in inventory levels, noting that cleaner inventory helped improve sell-through rates and reduce discounting pressure. adidas has become more disciplined in supply planning, enabling it to focus on core franchises with improved full-price sales. lululemon has taken a more cautious approach to inventory management, though pressures are rising. The company reported a 23% increase in dollar inventory and 16% in units in the first quarter of fiscal 2025, mainly due to tariffs and FX, and not overstocking. While traffic in the United States remains soft, lululemon is confident in its inventory quality and has only modestly raised markdown expectations for the second half. NKE's Price Performance, Valuation & Estimates Shares of NIKE have lost 2.2% year to date compared with the industry 's decline of 6.6%. Image Source: Zacks Investment Research From a valuation standpoint, NKE trades at a forward price-to-earnings ratio of 41.17X compared with the industry's average of 29.33X. The Zacks Consensus Estimate for NKE's fiscal 2025 earnings implies a year-over-year plunge of 22.7%, while that for fiscal 2026 indicates growth of 55%. The company's EPS estimate for fiscal 2025 and fiscal 2026 has moved down in the past 30 days Image Source: Zacks Investment Research NIKE stock currently carries a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Zacks' Research Chief Names "Stock Most Likely to Double" Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest. This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%. Free: See Our Top Stock And 4 Runners Up Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NIKE, Inc. (NKE): Free Stock Analysis Report lululemon athletica inc. (LULU): Free Stock Analysis Report Adidas AG (ADDYY): Free Stock Analysis Report
Yahoo
18 hours ago
- Business
- Yahoo
1 Incredible Reason to Buy This Dividend Stock Before July 29
Key Points This coffee shop giant is embarking on a turnaround plan, and there have been positive results. It reports on July 29, and the environment has become more favorable, making a positive report more likely. Its dividend has an attractive yield. 10 stocks we like better than Starbucks › Starbucks (NASDAQ: SBUX) stock has likely minted its share of millionaires, but not with its recent performance. The coffee shop giant has had some major struggles over the past five years, and its stock trails the market's 109% gain with its own 37%. That's incredibly demoralizing for shareholders who have held on with the hopes of seeing a return to past performance levels. Fortunately, that improvement might be just around the corner. Coffee lovers are out again Starbucks has cycled through several CEOs over the past few years, ever since sales began sinking during the pandemic. It has landed on well-respected CEO Brian Niccol, and he's in the process of effecting a potential turnaround. He seems super upbeat about Starbucks' prospects and recently gave a confidence-boosting assessment of how the company is doing in the most recent earnings report. For example, in test locations with a new order sequencing algorithm, average wait times fell by two minutes, bringing 75% of orders at peak times to under four minutes. That coincides with improvements in food services data from the U.S. Department of Commerce. Retail and food services sales increased 0.6% in June from the previous month, and 3.9% year over year. That was driven by an overall 6.6% increase in food service and drinking sales year over year. Niccol did not provide guidance for the 2025 fiscal third quarter (ended June 30) because he felt that there are too many unknowns as he reshapes the company's strategies and processes in a challenging economic environment. Comparable sales were down 1% in the second quarter (ended March 30), and there were major declines in operating margin and earnings per share (EPS) as the company restructures amid economic pressure. Starbucks reports third-quarter results on July 29. If the company impresses investors with improvements, which seems likely considering the better operating climate, the stock should jump. In the meantime, shareholders are enjoying the growing dividend that yields 2.6% at the current price. Should you buy stock in Starbucks right now? Before you buy stock in Starbucks, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Starbucks wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $665,092!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,050,477!* Now, it's worth noting Stock Advisor's total average return is 1,055% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Starbucks. The Motley Fool has a disclosure policy. 1 Incredible Reason to Buy This Dividend Stock Before July 29 was originally published by The Motley Fool Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
The Independent
18 hours ago
- Business
- The Independent
The Works cheers ‘early success' in turnaround strategy
The Works has hailed 'early success' with its turnaround strategy as the retailer saw profits jump by around a fifth. Shares in the books and stationery chain rose on Tuesday as a result. The retail firm told shareholders it benefited from a 'strong' performance after Christmas, with like-for-like sales rising by 6.4% in the final quarter of its financial year. It reported that total revenues were down 2% to £277 million for the year to May 4, compared with the previous year, although like-for-like sales grew 0.8%. Store sales drove growth throughout the year, as customer events, new products and 'improved store standards' helped contribute to 2.3% like-for-like growth. However, online sales declined by 12.1% after it was knocked by 'temporary capacity constraints' at a third-party provider during peak season. The Works recorded a pre-tax profits of £8.3 million for the year, rising from £6.9 million a year earlier. On Tuesday, the company also revealed that trading has been 'strong' over the first 11 weeks of the new financial year with like-for-like sales growth of 5%. Gavin Peck, chief executive of the Works, said: 'We are delighted to have ended full-year 2025 in line with recently upgraded market expectations in a year defined by ongoing uncertainty and fragile consumer confidence. 'This encouraging performance is a huge credit to the early success of our new strategy launched in January 2025, Elevating the Works, which is already delivering tangible results. 'The strong trading delivered post-Christmas has continued into the start of our new financial year, with customers clearly loving our new spring and summer product ranges.' Shares in the The Works were up 9.4% on Tuesday.
Bloomberg
2 days ago
- Business
- Bloomberg
Elliott Calls on BP's New Chairman to Urgently Fix Shortcomings
Elliott Investment Management, which is one of BP Plc 's largest shareholders, wants the energy giant's incoming chairman to urgently improve the firm's cost base and capital allocation, citing a weak turnaround plan. 'As one of BP's largest shareholders, Elliott believes the company requires decisive and effective leadership to overcome its chronic operational under-performance,' its spokesperson said in a statement.
Daily Mail
2 days ago
- Business
- Daily Mail
John Lewis and Waitrose staff set to receive bonus for the first time in four years
John Lewis is set to pay a bonus to thousands of staff for the first time in four years after a challenging period for the company. The employee-owned business, which runs the department store chain and Waitrose supermarket arm, is considering the bonus after a turnaround in performance. John Lewis initially pressed pause on the payouts for its 69,000 staff in 2020 - the first time since 1953 - as it was hit by pandemic lockdown store closures, and has not paid a bonus to staff since 2022. In March, the company said it would not pay a bonus despite seeing an upturn in profit, instead focusing on improved pay and investment in the business. It received backlash from employees who launched a petition saying they were 'working harder than ever' but 'getting less recognition'. However, the board will now reportedly be asked to recommend a payment if pre-tax profits reach £200million in the year to February 2026. An internal update seen by the Financial Times said it was aiming for over £200million profit, adding that 'to get there we need to keep focused on the right things and deliver our plans'. It would mark a significant reversal in fortune for the company, which has struggled with dwindling sales and increased competition. Profit before tax reached £97million in the year to 31 January 2025, up from £56million a year earlier and the company said it expects to increase profitability in the coming year. New chair Jason Tarry is overseeing a transformation plan this year, which includes a self-funded investment of £600million. The retailer said the transformation would include 'store refurbishments and openings, technology upgrades, and supply chain modernisation.' In another sign that Tarry's turnaround plan is gaining momentum, John Lewis topped customer service rankings, ahead of rival M&S. John Lewis scored 86.7 out of 100 in a survey of 60,000 shoppers by the Institute of Customer Service, while M&S scored 85.6.
