Nike Stock is headed to new heights this year, thanks in part to its push in metaverse, according to a Wall Street analyst.
Guggenheim Robert Drbul dubbed athletic apparel retailer a “best idea” for 2022 in a Dec 31 statement, saying that Nike is “rapidly embarking on the next era in its corporate history,” which he ‘expects it to be “digitally led”.
“The brand holds a dominant market share, which is expected to grow materially from here as digital-scales further, new product innovation remains robust, & heavy investments behind key growth drivers continue,” he wrote.
Drbul maintained a buy rating & target price of $195 on Nike stock, which fell 1.8% on Monday after rising 18% in 2021.
He said the company is “the leader in sportswear industry” and increased its earnings per share estimate for 2023 to $4.85 from $4.50 and for 2024 to $5.70 from $ 5.27.
Drbul said he is closely monitoring the evolution of Nike’s digital strategy & its engagement in Metaverse, a digital world where people interact. “What would the outlook be for 2022 without mentioning the metaverse?” ” He said.
Nike pushed into the future of the Internet, called both Web 3.0 & Metaverse. Its efforts included video games, building a metaverse studio, and even a promised line of digital sneakers called CryptoKicks.
In December, the Beaverton, Oregon-based company announced the acquisition of influential digital sneaker maker RTFKT, which previously received a valuation of $33 million in a funding round led by Andreessen Horowitz.
The Metaverse entered the mainstream in 2021 when the company formerly known as Facebook was renamed Meta. The concept struggled to land on a single definition, & prominent people, like Tesla’s Elon Musk, completely snubbed the idea.
Even so, many see NFT, as the key to unlocking this digital world where avatars of individuals can shop, play video games, build worlds, buy land, & more.