In the high-stakes world of athletic apparel and footwear, a few rivalries are as iconic or as competitive as that between NIKE Inc. NKE and adidas AG ADDYY. Operating in the expansive and fast-evolving global sportswear industry, both companies design, manufacture and market performance-driven and lifestyle-focused products, including sneakers, sportswear, accessories and equipment. While NIKE, headquartered in the United States, is the undisputed global leader in athletic wear by revenues, Germany-based Adidas holds a strong international footprint and a legacy of innovation and fashion-forward athletic design.
These two titans not only compete for consumer loyalty and athlete endorsements but also battle across key metrics such as revenue growth, brand equity, digital transformation, and sustainability leadership. As consumer preferences shift and the market becomes increasingly digitized and performance-driven, this face-off delves into how NIKE and Adidas are navigating industry trends, defending their market positions, and evolving to capture the next generation of global customers.
So, which of these two athletic giants is better-positioned for long-term growth and which stock looks more compelling right now? Let us take a closer look.
The Investment Case for NKE
NIKE remains the undisputed leader in the global athletic footwear and apparel market, supported by powerful brand equity, world-class marketing partnerships and a dominant global distribution footprint. Its ability to blend sport performance with cultural relevance has made it a category-defining brand with resilient consumer demand across both performance and lifestyle segments.
Despite facing near-term macro and operational headwinds, including tariffs and inventory normalization, NIKE’s management is taking decisive action. The company’s “Win Now” strategy is aimed at reigniting growth through rebalanced wholesale partnerships, faster innovation cycles, refreshed product lines and tighter inventory discipline. These initiatives are designed to stabilize performance in fiscal 2025 and position the brand for stronger growth into fiscal 2026.
In the long term, NIKE is doubling down on its core identity — sport. The brand is accelerating its product pipeline, expanding into new performance categories and leveraging bold marketing to reassert its cultural leadership. Strategic moves to elevate retail presentation and reduce discounting are expected to enhance brand perception and support margin recovery.
Innovation remains central to NKE’s strategy. The introduction of the “Speed Lane” development model, alongside the existing “Express Lane,” enables quicker responses to consumer trends and greater agility in bringing new designs to market. A wave of franchises is set to launch in the second half of fiscal 2025, positioning NIKE to recapture momentum across running, training and lifestyle.
As NIKE shifts its digital strategy to focus on full-price sales and organic traffic, it is building a more balanced and premium-aligned business. With strong brand fundamentals, proactive leadership and a clear roadmap for profitable growth, NKE offers a compelling long-term investment opportunity in the global athleticwear space.
The Investment Case for ADDYY
adidas is one of the world’s leading athletic brands, with a powerful global presence and strong heritage in sport, style and innovation. The company is in the midst of a strategic turnaround under new leadership, focused on revitalizing brand heat, improving execution and unlocking long-term shareholder value.
After a period of operational missteps and inventory challenges, adidas is executing a focused recovery strategy. The company is cleaning up excess inventory, rebalancing supply and demand, and narrowing its product focus to fewer, more impactful franchises. Management is also reinvesting in product design, marketing and storytelling to re-energize core categories like Originals, Running and Football (Soccer), as well as reigniting its position in sport-inspired lifestyle.
A critical element of the turnaround is adidas’s renewed emphasis on innovation and product credibility. Recent launches, including the revival of iconic models and the introduction of fresh silhouettes like the SL72 and Spezial, have been well received — a sign of brand momentum returning. The company is also leveraging its deep roster of cultural collaborators, athletes, and creatives to drive distinctiveness and relevance across global markets.
Financially, ADDYY has reset expectations and provided greater transparency under new CEO Bjørn Gulden. While near-term profitability remains under pressure due to ongoing inventory normalization and the wind-down of remaining Yeezy inventory, adidas is setting the stage for a return to sustainable growth and margin expansion from 2025 onward.
With a cleaner cost base, tighter operational discipline, and a strong balance sheet, adidas is well-positioned to scale new product success and improve profitability. As the brand rebuilds its emotional connection with consumers and returns to sport-driven innovation, ADDYY offers an attractive recovery and growth story with significant upside potential.
How Does Zacks Consensus Estimate Compare for NKE & ADDYY?
The Zacks Consensus Estimate for NIKE’s fiscal 2025 sales and EPS implies year-over-year declines of 10.7% and 45.6%, respectively. EPS estimates have been unchanged in the past 30 days.
Zacks Investment Research
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for adidas' 2025 sales and EPS suggests year-over-year growth of 12.3% and 83%, respectively. EPS estimates have moved up 1.9% in the past 30 days.
Zacks Investment Research
Image Source: Zacks Investment Research
This clearly illustrates that adidas has witnessed an upward estimate revision trend in the past 30 days, giving it an edge over NKE. Moreover, estimates for both NKE and ADDYY indicate year-over-year increases in sales and earnings for the current year.
Price Performance & Valuation of NKE & ADDYY
In the year-to-date period, the ADDYY stock had the edge in terms of performance, having a total return of 2.2%, including dividends. This has noticeably outperformed the benchmark S&P 500 and NIKE’s declines of 0.6% and 18.5%, respectively.
One-Year Price Performance
Zacks Investment Research
Image Source: Zacks Investment Research
From a valuation perspective, NIKE trades at a forward price-to-sales (P/S) multiple of 2.02X, which is above its 5-year median of 5.63X. adidas is trading at 1.49X, below its 5-year median of 2.82X.
Zacks Investment Research
Image Source: Zacks Investment Research
The NIKE stock seems pricey. Its focus on repositioning itself to be more competitive and drive sustainable, profitable long-term growth looks good. However, the ongoing challenges, including soft sales in its lifestyle segment, declining digital revenues and headwinds in Greater China, raise doubts about whether its premium valuation is sustainable.
Conversely, the adidas stock appears undervalued relative to its long-term potential. ADDYY has made meaningful progress in recent years by prioritizing innovation, normalizing inventory levels and rebuilding product credibility. ADDYY appears more attractively valued on a relative basis, suggesting an upside if execution improves.
Conclusion
While both NIKE and adidas are dominant players in the global athleticwear market, the near-term setup appears more favorable for adidas. NIKE is in a period of transition, working to recalibrate its strategy and reignite growth. In contrast, adidas is showing early signs of a more agile and focused turnaround, with momentum building in product credibility, brand heat and operational execution.
Given its lower valuation, cleaner inventory position and renewed leadership direction, ADDYY currently offers a more compelling risk-reward profile for investors seeking exposure to the sportswear space. adidas currently carries a Zacks Rank #2 (Buy), whereas NKE has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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
