Should You Buy Nike Stock Before March 31?

Nike (NYSE: NKE) is a company that's facing significant adversity these days. It has made a change in CEO in an effort to turn its business around, but that's been proving to be difficult. Meanwhile, the current economic conditions aren't helping matters as consumers are trading down to buy lower-priced products in an effort to save money, plus tariffs are also impacting the company's operations.

Later this month, on March 31, Nike is set to release its third-quarter earnings numbers for fiscal 2026. Any sign of progress could help give the stock, which is down 24% over the past year, a much-needed boost. With so much bad news already factored into its share price, could buying the stock before earnings be a good move?

Image source: Getty Images.

Nike's growth rate is the big question mark heading into earnings

The problem in recent years has been a simple one for Nike: consumers haven't been buying up its apparel and footwear products at the same pace and enthusiasm that they have in the past. While the company's growth rate did improve in its most recent quarter, it was also going up against some lighter comparables from the prior-year period. The overall trend has been a troubling one, with Nike struggling to keep its growth rate in positive territory.

NKE Revenue (Quarterly YoY Growth) data by YCharts

The silver lining for the company has been that in North America, its major market, sales rose by 9% in the most recent quarter and were up by 6% over the past six months. Unfortunately, that growth has not resulted in a better bottom line as rising costs have overshadowed the steady progress; Nike's net income over the past two quarters has totaled $1.5 billion, which is down 31% from a year ago.

The stock may appear cheap, but it comes with risk

It's been a steep fall for Nike, as the stock is currently trading close to a 10-year low. It has the potential to be a bargain buy, but with turnaround attempts, it can be a long and frustrating process for investors. And it may not necessarily pay off. While Nike has been a top apparel brand for decades, the rise of fast fashion could put that into jeopardy in the future, as it may be more difficult than ever for consumers to justify paying a premium price for Nike's high-priced products.

Nike's upcoming earnings report may show more growth as it goes up against some weaker numbers from last year, but I think things may get worse before they get better for the stock, given the current economic conditions. That's why I wouldn't rush out to buy the shoe stock, as there's still too much uncertainty around the business to make it a good buy today.

David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nike. The Motley Fool has a disclosure policy.