What the new Nike CEO's priorities should be: Analyst

Fri, Sep 20, 2024, 4:00 AM

Bernstein senior analyst Aneesha Sherman thinks Hill has "the right skill set" for the role and that the C-suite shake-up is good for the stock. So what will he need to do? Sherman says his first task will be "to set a path forward" for the apparel giant and "give investors a sense of where this company is headed." But then he'll really have to get to work. "This is a tanker that needs to be moved and it takes time. But I think investors will give him a pass if the targets sound reasonable, the goals sound reasonable and will give him a pass for the next 6 months to a year to fix the ship before it starts moving again," she tells Yahoo Finance.

Watch the video above to hear why Sherman says one of Hill's priorities also needs to be helping Nike get its "mojo" back.

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00:00 Speaker A

So Anisha, uh, Elliot Hill now coming in, what are his priorities, Anisha?

00:10 Anisha

So I think the first priority will be to set a path forward. And so the investor day is coming at a at a good time. He needs to set the path forward for the next five years, set some targets, give investors a sense of where this company is headed and what kind of numbers to expect, what kind of algo to expect for growth and earnings growth. And that will set the course of of investor expectations and probably stabilize the stock a little bit. And then he needs to do more work. I mean, this is not a slow, this is a this is a tanker that needs to be moved and it takes time. Um, but I think investors will give him a pass if the targets sound reasonable, the goals sound reasonable, and we'll give him a pass for the next six months to a year to fix the ship before it starts working again.

01:47 Speaker A

Anisha, what needs to be the goal in terms of product?

01:52 Anisha

So Nike has somewhat lost its mojo in the market. Um, you know, it it made several different mistakes. One was just the product process got so convoluted and delayed with a couple of different reorganizations, changing the way product reviews are done to the point where even small incremental additions take a year to get out to market. So we need some more nimbleness, we need some more speed and reaction to the market. And then the second piece is, we just need to, they just need to control scarcity in the market. They over distributed several of the hot products to the point where they lost their brand heat. So they need to regain that scarcity and demand pull.