Nikes crashed by 25% in two days – the investment house that recognizes an opportunity

Stock Nikes Completes a 25% drop in the stock in the last two days, after publishing its reports for the first half of 2026. Nikes, which operates credit settlement solutions and can be identified in many places in the yellow boxes for payment at machines, such as drink machines, sweets or parking lots, did present a 28% increase in revenue to $122.6 million, but on the other hand, it posted a loss of $10.1 million. According to her, following one-time expenses of stock-based compensation.

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What really surprised investors was the company’s forecast.

Although the company confirmed its revenue forecast of $510-520 million in the top line, it sharply cut its forecast for the annual free cash flow rate that the company will generate this year from the adjusted EBITDA (earnings before interest, taxes, depreciation and amortization). According to the company, the conversion rate is expected to be only 5-10% compared to 40% in the forecast from the previous quarter. In the second quarter of the year, it went into the negative of 13.1 million dollars, meaning that the company spent more than it brought in.

According to Nikes, the reason for this is the investments it makes that will support its growth in the future. If it is an investment in its financial services and if it is investments in the Lynkwell activity that it acquired last year in the field of charging electric vehicles, which in the meantime has also affected its gross profit rate. According to Nikes, this is not a change in its operational forecast.

However, in a longer forecast, Nikes continues to believe it will reach $1 billion in revenue in 2028 with a gross margin of 50% and an adjusted EBITDA of 30%.

As mentioned, the investors were concerned and dropped the stock by 16.5% on Tuesday and the stock completed a 25% fall in two days. The stock is now traded at a value of NIS 5.7 billion.

The investment thesis has not changed

Meanwhile, the William Blair investment house confirms the “excessive yield” recommendation for the Nikes stock, and estimates that the sharp drop in the stock following the reports is actually a buying opportunity.

“Investments in growth create noise, but the basic investment thesis has not changed”, the investment house points out that the weakness in the second quarter was due to operational balance and investments in the future and not to a negative change in performance: while revenues stood at $123 million (an increase of 28% year-on-year, above forecasts), EBITDA was $3.8 million below forecasts due to erosion in the profitability of the sale of devices.

Despite this, the analysts receive a windfall from the continued growth in recurring revenues, a 15% increase in the average transaction amount and the confirmation of the company’s forecasts for 2026.

At William Blair, they indicate long-term growth engines such as expansion in the field of electric vehicle charging and expansion into financial services (including the request to establish a bank in the US), and slightly raised the revenue forecast for 2026 to approximately 518 million dollars.