Our DCF-based target price of $50 assumes a 12% discount rate and a 5x terminal multiple on year five EBITDA. Our target price implies an F26E P/E multiple of 8.2x and an F26E EV/EBITDA multiple of 5.4x.

Upside risk to our target price includes: (1) Sales trends could perform better than our expectations; (2) Tariffs rates could migrate lower, removing earnings pressures; (3) Consumer spending could accelerate proving upside to our ests.

Downside risk to our target price includes: (1) Lower income consumer weakness persists into F25 and beyond; (2) Nike's turnaround strategy does not prove successful; (3) New store opening plans fall short of expectations/mgmt's goals; (4) The promotional envirnoment intensifies; (5) Broader macro-economic slowdown in the US.