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Banc of America Securities downgrades Nike

Banc of America Securities downgraded Nike Inc. Wednesday on concerns of softening global demand.
/ Source: The Associated Press

Banc of America Securities downgraded Nike Inc. Wednesday on concerns of softening global demand.

Trends in the past two months, such as a recessionary state in Western Europe, post-Olympic inventory buildup in China and a changing economy in Latin America, point to a larger global slowdown in demand. Analyst Camilo Lyon said in a note that the impact would be too much to overcome and shifted Nike's rating from "buy" to "neutral".

Nike has a solid balance sheet and strong free cash flow, Lyon said, but changing global demand will constrain Nike's growth into the 2010 fiscal year and shares will languish for the next several quarters.

Shares of Nike fell $3.41, or 6.4 percent, to $49.53 in afternoon trading Wednesday.