Nike just had one of the worst weeks any stock in the S&P 500 has had all year. And Wall Street is still trying to figure out if that makes it a buy or a warning sign.

Shares dropped 14% in a single week. The stock's relative strength index - a measure of whether a name is overbought or oversold - fell to 15.8. Anything below 30 is considered oversold. Nike is deeply below that line.

What Went Wrong

On Tuesday, Nike said it expects fiscal fourth-quarter sales to drop between 2% and 4%. Analysts had been expecting a 1.9% increase. That gap rattled the Street.

Executives blamed disruption in the Middle East and rising oil costs, which could push up expenses or pull back consumer spending. Nike also said sales would fall by a low single-digit percentage through the rest of the calendar year.

More than 20 analysts cut their price targets on the stock in a single day. The message was consistent - the turnaround under CEO Elliott Hill is taking longer than expected, and the macro environment is making it harder.

The Bull Case

At 1.69 times sales, Nike is trading at its cheapest level since 2015. The stock is down roughly 35% from its year-to-date high.

Truist analyst Joseph Civello still recommends buying on the dip, even though he acknowledges the turnaround will be "choppy" through the end of 2026. Nike paid a $0.41 quarterly dividend on April 1 - its 24th straight year of increases.

There's also a tailwind on the calendar: the 2026 FIFA World Cup. Nike has historically seen a sales bump during major global sporting events.

What to Watch

The question for investors is whether this is a buying opportunity or the start of a longer slide. Nike's brand is still one of the most recognized in the world. But brand strength doesn't fix a sales forecast that missed by a wide margin.

The next few quarters will tell investors whether Nike's Sport Offense strategy is gaining traction or just burning time.