Nike (NYSE: NKE) and Estée Lauder (NYSE: EL) have both suffered significant declines from their highs, making them compelling candidates for long-term investors willing to weather near-term turbulence.
Nike has fallen roughly 44% from its peak, while Estée Lauder sits approximately 30% below its own recent high, leaving both stocks attractively priced for those with a decade-long horizon.
The key distinction for investors is separating companies with fundamentally broken businesses from strong brands simply navigating a difficult period, and both Nike and Estée Lauder fall into the latter category.
Nike spent years pulling back from retail partners and leaning heavily on its own apps and direct website, a strategy that hurt demand and damaged relationships with the stores where most consumers actually shop.
CEO Elliott Hill, a Nike veteran who came out of retirement to lead the turnaround, has been rebuilding those wholesale relationships and refocusing the brand squarely on athletes and new product development.
Early results suggest the effort is gaining traction, with Nike’s largest market, North America, beginning to grow again as retail partners welcome the brand back onto their shelves.
The turnaround is taking longer than management initially anticipated, with the more meaningful gains now expected in 2027 and beyond, and the China business continues to shrink in the meantime.
Hill has been buying shares with his own money, a meaningful signal that the man leading the recovery believes strongly in the company’s long-term prospects.
Estée Lauder faces its own set of headwinds, including a slump in China, weakness in airport travel-retail channels, thinner profit margins, and the additional pressure of tariffs weighing on the stock.
The company owns a powerful portfolio of premium beauty brands, including its namesake line, Clinique, MAC, and La Mer, brands that carry significant pricing power and consumer loyalty around the world.
Recent quarterly revenue has grown and come in ahead of expectations, suggesting the recovery at Estée Lauder is slowly beginning to take hold across its key markets.
The long-term investment case rests on two durable trends: the global appetite for prestige beauty continues to expand, particularly as consumers in emerging markets trade up to premium products.
For both companies, the risk is clear — neither turnaround is guaranteed to be smooth, and investors should enter with the expectation of continued volatility along the way.
Buying a stock that is down 40% or more requires a strong stomach, but that discomfort is precisely what creates the pricing opportunity for investors who can take the long view.
When the investment horizon stretches across a full decade, the bet is on brand durability rather than any single quarter’s results, and both Nike and Estée Lauder have historically proven capable of outlasting their slumps.
