After a bad week at Wall Street, analysts at Merrill Lynch are encouraging their clients to buy stock of Nike and Under Armour.

As highlighted by investment bank, Nike shares have been up by 25 percent over the year to date. Nike Inc. (NYSE: NKE) posted solid fiscal fourth-quarter earnings in June, while it also holds outstanding potential upside from a turnaround in its China business, improvements in gross margins and continued innovation-driven market share gains in both basketball and running footwear, as highlighted by ´24/7 Wall Street’.

Nike investors are paid a 0.95 percent dividend. The Merrill Lynch price target for the stock is 140 dollars, and the Thomson/First Call consensus price target is 140.25 dollars.

Under Armour “is another apparel leader that was absolutely mauled last week and could have huge upside for investors” as per Merryl Lynch´s analysis. Under Armour Inc. (NYSE: UA) reported a net revenues increase of 28 percent in the third quarter of 2015 to 1.20 billion dollars, compared with net revenues of 938 million dollars in the prior year’s period.

Likewise, net income increased 13 percent in the third quarter of 2015 to 100 million dollars, compared with 89 million dollars in the prior year’s period, and diluted earnings per share for the third quarter of 2015 were 0.45 dollars, up from 0.41 dollars per share a year earlier.

Merrill Lynch has set a price target of 108 dollars on the stock, ahead of consensus target of 107.43 dollars.

 

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