The clock is ticking on Nike’s recovery. Without any signs of improvement, Jim Cramer said we may soon have to make a hard decision on the stock. “I want to wait until the fall before we cashier [Nike’s stock] and take the loss, or I see some green shoots by then,” Jim said Friday during the March Monthly Meeting . “If I see some green shoots, we could buy some more.” Jim’s commentary comes ahead of Nike’s critical fiscal 2026 third-quarter earnings report Tuesday night. It is CEO Elliott Hill’s latest chance to show a skeptical Wall Street that his “Win Now” turnaround initiative is working. Since taking over in October 2024, Hill has made changes to executive leadership, managed to largely clear a backlog of classics inventory, and introduced a fresh lineup of products. Some of its recent drops include the Nike Mind collection , which officially launched in January, and the NikeSKIMS activewear collaboration with Kim Kardashian’s brand. New, exciting collections can help drive sales and reinvigorate the brand. But so far, nothing has been enough to sustain momentum in the stock — not even the Supreme Court striking down President Donald Trump’s emergency tariffs last month, on its face a win for companies like Nike that have seen their profits squeezed by elevated import duties. Nike shares are down more than 18% year to date, with the vast majority of the declines coming since the Iran war broke out on Feb. 28 and muddied the outlook for the global economy. At roughly $51 per share on Monday, the stock is down roughly 35% from its 52-week closing high of $79.24 in July. Nike’s performance in China will be under the microscope Tuesday night, just as it was when the company reported second-quarter results in mid-December. In the three months ended in November, Nike’s Greater China segment saw a 17% year-over-year decline in sales, and executives guided for similar performance in the third quarter. That was one of the biggest reasons the stock plummeted 10.5% the following day. “I have not seen what I want to see, though, particularly in China, nor has anyone else,” Jim said at Friday’s Monthly Meeting. NKE 1Y mountain Nike’s stock performance over the past 12 months. Indeed, Evercore called China the biggest “swing factor” for the stock this Q3 earnings report. In a note to clients Friday, analysts said stronger-than-expected Lunar New Year trends from peer brands suggest Nike may have seen sequential improvement in the region. While Nike’s brand is still struggling in China, analysts said “retailers are positive on initial meetings with Nike’s new China leadership … and see the early signs of a better strategy emerging.” Hill in late January announced that Angela Dong, its top executive in China since 2015 , would be replaced by Cathy Sparks, who previously led Nike’s Asia Pacific Latin America division. Nevertheless, Evercore said if the China results disappoint and management indicates it’s too early to offer details on a turnaround strategy, the stock could see even more declines ahead. The initial focus of Hill’s revival efforts has been in North America, Nike’s largest market by sales. The bulls have been able to hang their hat on the fact the region has showed progress, with sales up 9% annually last quarter to $5.6 billion. That was by far the strongest geography. “North America has been positive the last couple quarters, so I want to see continued positive growth in North America,” Jefferies analyst Randy Konik said Monday in an interview with CNBC. There is more to prove, though. Thus far, Konik said Nike’s growth in North America has been primarily driven by “sell-in,” or inventory sold to wholesalers like Dick’s Sporting Goods . For that reason, Konik said investors want to understand where Nike stands on “sell-through,” the term for retailers selling their inventory to customers. Under Hill, Nike has worked to repair its relationship with retailers after his predecessor, John Donahoe, made an aggressive push into selling directly to shoppers online and at its own stores. Nike’s direct-to-consumer business has become a drag, with revenues declining 9% last quarter and 5% in the June-to-August quarter. Accordingly, Konik said investors also want to see whether there’s “any movement or improvement” in the DTC business. Konik is among the 61% of Nike analysts who have a buy rating on its stock, according to FactSet data. His price target of $110 implies more than 100% upside for shares, making him one of the most bullish analysts on the Street. Evercore also has a buy rating on the stock, though the firm on Friday cut its price target to a much more modest $69 from $77. Our price target is $75. UBS analysts, who have a hold-equivalent rating on Nike’s stock, said in a note last week they’re curious about the weight of several macro issues, including the fallout from the war in Iran. Among their top questions for management: What percentage of sales are from the Middle East, and what is the impact of elevated oil prices on product and logistics costs? The analysts also want an updated view on what tariff costs Nike expects to incur moving forward, given the recent Supreme Court ruling. For their part, analysts at Goldman Sachs on Monday reiterated their buy rating ahead of the quarter, telling clients they believe “current expectations appropriately reflect near-term choppiness” in the turnaround. The steps that Hill is taking are helping set the groundwork for improved momentum into next fiscal year and beyond, they said. Bottom line We’re giving Hill a fair chance to steer the ship in the right direction, especially considering some headwinds, such as the war in Iran, are out of his control. “I have faith in CEO Elliott Hill, and so does the board,” said Jim, noting the major insider buying by Nike directors, including Apple CEO Tim Cook, in response to the December earnings sell-off. Turnarounds take time, but we also don’t have forever. At Friday’s meeting, Jim said he’s willing to give it about a year from when we initiated the position in late September 2025 . “If it hasn’t turned [by then], it goes,” Jim said. (Jim Cramer’s Charitable Trust is long Nike. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. 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