Advisors, Analysts Brush Off Nike Controversy, Say Selloff Is Short-Lived

Analysts covering Nike and financial advisors overseeing investor accounts holding Nike, Inc. (NKE) stock are remaining firm in their belief that the current controversy related to Nike's new ad campaign featuring Colin Kaepernick is short-lived.

The scare today caused shares to fall by 3.2% as of market close after trading volume spiked to its second highest level of the year. The volume level today was only eclipsed by trading on the company's fiscal fourth quarter results on June 29 that, in contrast with today, sent shares soaring 10% on strong reported results.

"They say 'Just Do It', but I guess they're realizing that shareholders have the right to do what they want to do too," Dennis Fagan, founder and partner at Fagan Associates, a financial advisory firm that manages a total of $222.8 million and 6,595 shares of Nike on behalf of clients told Real Money.

He explained that "a handful" of his clients had called in to request that he sell Nike based upon the ad campaign and their disagreement with its political motivation. Although he noted that the number of requests received was abnormally high, he clarified that he is advising against his clients selling the stock.

"We're not selling our shares unless we have to," he said. "We tend to think Americans have a short attention span on this type of stuff."

He affirmed his plan to hold steady with his shares, adding that if there is significant enough a pullback, he would consider it a buying opportunity rather than a sell signal.

"If it were to pull back $10 or $15 we might see a good buying opportunity," he said. "We'd be looking around $65 to $70 to get back in."

Analysts covering the stock also maintained trust in the company's trajectory as they specifically downplayed the impact of the campaign commotion on sales estimates for Nike products.

John Staszak, a securities analyst on consumer discretionary and consumer staples for Argus Research Company that covers Nike, indicated his belief that the short-term selloff today should have a "negligible" impact on sales numbers in the long term.

Staszak indicated that he believes this will only be a short-term problem for Nike shareholders, drawing a parallel to the debate over marijuana and the recent inroads made by alcohol distribution companies into the space.

"I would think it would not have too much of an impact on sales and shouldn't be a major factor for most long-term shareholders," he explained. "It is a lot like Constellation Brands (STZ) and Canopy Growth Corporation (CGC) . Some people will just be really upset by it right away."

Overall, the sentiment from both analysts and advisors seems to be that while Nike may have tripped a bit today, today's investor panic will not act as a roadblock in its continued run that has garnered an over 25% return year to date.

Both parties will look forward to the next earnings release on September 25 which will offer a clearer look at how long the attention span of panicked investors really is.