Nike faces record short interest as stock slides and analysts stay bearish

Nike's stock performance this year has been marked by a steep decline, driving short interest to an all-time high according to a recent S3 Partners report. The report indicates that short sellers have steadily increased their positions as the price fell, amassing a large unrealized profit. With the company's first-quarter earnings due on Thursday, the unusually large short base could become vulnerable to a short-covering rally if results improve.

In addition to the short-selling pressure, Bank of America recently cut its rating to sell, and analyst Lorraine Hutchinson warned that a turnaround may take longer than expected, citing weak sales in China and reduced demand for legacy sneaker lines. Nike is on track for its weakest year since the early 1990s, and the recent departure of football star Kylian Mbappé after two decades further underscores challenges for the brand.