AP/Mary Altaffer Nike CEO Mark Parker.
The competition between Nike and Adidas is getting crazier.
The largest sportswear maker was downgraded from "buy" to "hold" by Jefferies analysts in light of "intensifying US competition" from main competitor Adidas.
"The athletic footwear cycle and Nike brand power are strong, but the competitive landscape should make share gains and margin expansion elusive," CNBC reports, citing Jefferies research.
Adidas has successfully avoided downward trends in the athletic shoe and apparel markets. The brand's innovation and redesign efforts are now hurting Nike.
"Adidas has been successful in leveraging the spark from its fashion retro footwear resurgence into other categories like running and athletic apparel," the note reads.
As of May, Adidas sales were up 74% year over year, while Nike sales declined in the mid-single digits, according to NPD. Adidas has been rapidly gaining market share, and Nike and its Jordan brand were both donors.
The two brands are locked in a bitter battle over a category that has seen soft sales in recent months.