Nike Stock Set to Dip After Rare Downgrade

HSBC downgraded Nike Inc (NYSE:NKE) to "hold" from "buy," but left its price target unchanged at $92 -- an 11.1% premium to last night's close at $82.77. The brokerage firm cited a lack of positive catalysts and the athletic apparel retailer's failure to raise its full-year forecast following last week's profit beat and impressive sales related to its Colin Kaepernick ad campaign.

Most analysts are upbeat toward the Dow stock, with 14 brokerages maintaining "buy" or better ratings, compared to nine "holds" and one "sell," at last night's close. Plus, the average 12-month price target has risen to $87.69 from $83 just three weeks ago.

The optimism has been seen in the options pits, too. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), NKE's 10-day call/put volume ratio of 1.92 ranks in the 73rd annual percentile, meaning calls have been bought to open over puts at a quicker-than-usual clip.

It's not hard to see why Wall Street is so bullish toward Nike, when looking at the retail stock's chart. The shares have surged nearly 61% year-over-year, with the 30-day moving average serving as a springboard for NKE in the last six months. Plus, the security hit a record high of $86 as recently as Sept. 21. Today, though, the equity is set to pare a portion of these gains, down 0.6% in electronic trading.