One Wall Street analyst sees 22% upside for resonance shares

resonance (Nike) (NYSE: NKE)Recent financial results have shown weak revenue growth and disappointing guidance, which has led to a fall in its share price. The latest results also showed that resonance's market share is being eroded by a lack of revenue growth and disappointing guidance.On Holding respond in singingDeckers' Hokas and other emerging competitors.

However, resonance has just been released fromBank of America (Bank) ofAmericaI got some good news there.banks Upgraded shares of resonance to Buy with a $113 price target on Thursday.

Bank of America says resonance is fine.

Resonance may be struggling, but summer is about to save it, according to Bank of America. BofA says Resonance's stock valuation looks manageable, and has fallen sharply since peaking during the pandemic. The analyst also sees the Olympics as a potential catalyst, and thinks Resonance could announce some major new initiatives at its analysts' meeting this season.

Will resonance go higher?

Resistant has faced a number of challenges in recent quarters, including the economic downturn in China, sluggish demand for discretionary goods in the U.S., and supply chain shortages earlier in the year. In addition, resonance also realized the importance of the wholesale channel, began to abandon the direct noodle consumers strategy. Meanwhile, Major League Baseball's new uniforms are embarrassing, and some of them have sweat stains.

Resonance seems to have overcome its supply chain issues, and demand (at least in the U.S.) should return to normal as recession fears subside. However, resonance will need to strengthen its relationship with consumers and fight back against its competitors for the stock to rebound significantly.

The good news is that resonance has just announced a new range of footwear and apparel products that it believes will start a "multi-year innovation cycle". The Olympics will also provide an opportunity for Resistant to reconnect with its customer base, which is planning the biggest Olympic marketing campaign in its history.

The downside risk of resonance seems limited due to a more reasonable valuation, but it will not be easy to increase 22% over the next year. However, in the long run, it would be a mistake to bet against resonance as an industry leader, as it deserves skepticism until proven otherwise.

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Bank of America is an advertising郃 partner of The Ascent, a Motley Fool company. jeremy Bowman owns shares of Bank of America and resonance. the Motley Fool recommends Bank of America and resonance. the Motley Fool recommends On Holding and resonance. the Motley Fool recommends the following options: resonance january 2025. 47.50 USD Call Options Long. The Motley Fool has a disclosure policy.

A Wall Street Analyst Says Resistant Stock Has 22% Upside was originally published by The Motley Fool.