This one thing about Nike makes me nervous: Analyst

Nike has had a great run over the past month, with shares rising 15 percent on the back of a great earnings report.

And according to one analyst, the winning streak could continue at least in the short term, thanks to strong growth in China and Europe.

"I think this is a classic situation where Nike's on a run," Paul Swinand of Morningstar said Tuesday on "Power Lunch." "If they just did their analyst day, and they've upped their long-term forecast, they're seeing a lot of future orders acceleration, they're probably going to have a good holiday season."

Still, Swinand said he has some concerns about the athletic stock, most notably its exceptionally high valuation.

"I've got the stock worth 28-29 times forward earnings and I'm the low on the Street. The Street's valuing it over 30 times earnings, that's way above historical [averages]," he said. "I'm worried about the long run making a decent return."

Read More Consumer stocks may turn hot after cold start: Technician

According to technician Craig Johnson of Piper Jaffray, Nike shares looks vulnerable.

Although the stock has followed a multi-year uptrend, Nike shares currently look to be "overbought," says Johnson.

"I think the odds are, yes you will get that pullback and you'll get a better entry point," he said Tuesday on "Power Lunch."

But within the general industry, companies like Nike are a good place to look for growth, he said.

"Inside of the consumer cyclical sector, anything athletic, anything footwear, is really where the momentum is at this point in time. And certainly Nike and Under Armour are right there," Johnson said.


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Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

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