by Michael Tarsala
Earnings missed expectations, and so did revenue; the company had beaten analyst expectations 17 of the past 18 quarters.
He cited Citigroup's latest analyst note:
"There is no question Nike's earnings and subsequent guidance for FY13 was disappointing. We saw futures slow (most notably China), margins under pressure (again) and guidance for FY13 was lower than consensus."
Nevertheless, Citi said that Nike remains a "high quality growth story to own." Citi did lower its price target on the stock, however, from $123 to $98.
Nike joins a batch of former momentum retail names that have begun to decline just in recent weeks, including Under Armour (UA), Coach (COH), Ross Stores (ROST), Chipotle Mexican Grill (CMG) and Lululemon Athletica (LULU).
“The market doesn't like the momentum stocks right now, and especially the ones with high valuations and short interest, like CMG and LULU,” said Mike Arold of the Technical Swing model. "I think those are the ones that are headed lower. Once these momentum stocks start to fall, they can fall hard.”
We'll highlight some of Arold's latest moves in the retail sector on Monday in the Covestor blog.