Why Nike Stock Is Rising on Friday

Being in NIKE (NKE 6.20%) the stock hasn’t really been a winning game in recent years. Shares of the famous athletic shoe maker have trailed performance poorly S&P 500 index from the last decade.

But Nike shares are rising today. After rising nearly 9% Friday morning, shares were still trading up 5.8% as of 10:35 a.m. ET. That’s because investors hope the stock’s long slide will end with the CEO replacement.

Nike lost the race

Nike has been a high-flying act for years. But since Nike stock last split — a 2-for-1 split on Dec. 24, 2015 — its total return, which includes dividends, has been 41 percent, compared with the S&P 500’s return of 225 percent.

But yesterday, the company said it was replacing CEO John Donahoe with company veteran Elliott Hill, effective Oct. 14. Hill worked at Nike for more than three decades before retiring in 2020 after Donahoe was named CEO. Investors today believe the change will be a good thing and are not waiting to buy Nike stock.

The decision was endorsed by Donahoe himself. In a statement, he said: “It became clear that now was the time to make a change in leadership and Elliott is the right person. I look forward to seeing the future successes of Nike and Elliott.”

Hill was president of Nike’s consumer division and oversaw marketing and commercial successes, including the Michael Jordan brand, before leaving the company. Investors welcome his return, including competitors Outdoor deckersbrand of Hoka One One and On Holding they took the market share.

Nike may give investors a taste of what Hill has planned when it reports its fiscal first quarter 2025 financial results on Tuesday, Oct. 1.