After Pershing Square’s IPO flopped due to a lack of demand for his “Twitter Hedge Fund,” you might think Bill Ackman would play it safe for a while. But that’s not how Ackman operates. 

Instead of retreating, he’s back on the field with another bold move. Nike’s stock has had a tough year, dropping nearly 30%—a decline that would make even the most loyal Nike followers nervous about investing. But Ackman? He didn’t even blink. He dropped $229 million on 3 million shares of the swoosh brand, proving once again that he’s got nerves of steel and a sixth sense for spotting a bargain.

Let’s be real, Nike’s 2024 has been about as smooth as trying to walk in flip-flops on ice. The stock’s steep decline marks its worst performance since 2001, driven by challenges like a sluggish Chinese economy and tough competition from emerging brands like Hoka. Most investors might be wary, but Ackman saw this as a chance to make a strategic play. 

This isn’t his first encounter with Nike either. Back in 2017, he bought 5.8 million shares, rode out a 32% increase, and cashed in with a $100 million profit. It’s clear that Ackman knows how to time his moves when it comes to this brand.

So why is Ackman making a play for Nike again after such a brutal year? Well, according to his latest SEC filing, he’s betting on a rebound. If there’s one thing Ackman knows, it’s reviving a struggling investment. Just ask the folks at Canadian Pacific Railway, where he raked in $2.6 billion after a five-year activist campaign. He’s in it for the long haul, even if it means doing the unpopular at the time.

Nike’s recent earnings report delivered a reality check, with $12.61 billion in revenue, missing Wall Street’s target of $12.84 billion. This shortfall, though slight on paper, highlights a deeper issue—revenue for fiscal 2024 is stagnant, marking the slowest growth since 2010, with the only slower periods being when the world was in lockdown, binge-watching 'The Last Dance.' 

Looking ahead to 2025, the forecast is even worse, with sales expected to fall by mid-single digits, raising concerns about the brand’s future momentum. But let’s not kid ourselves—Nike knows how to play the long game. They’re not going anywhere. While they’re up against fresh competition like Hoka, they’ve got decades of experience, a massive R&D budget, and the kind of brand loyalty that most companies would kill for. Ackman’s move might look risky now, but if there’s one thing he’s proven, it’s that he can spot a winning bet before anyone else does.

Stock.News does not have positions in companies mentioned.