Cowen upgraded Nike stock on Tuesday to outperform from market perform, saying the upcoming products in 2019 are expected to boost its profits.

Cowen also raised its 12-month price target for Nike to $90 from $80, which would translate to a 13 percent gain. Shares of Nike rose fractionally on Tuesday to $80.75.

"Prospects remain solid for continued higher full price sell through and average selling price lift, which could drive gross margin above expectations," Cowen's John Kernan said in a note to clients. "We view Nike gross margin and the concept of Speed as key catalysts to near-term and multiyear upside to gross margin and the company's path to $5 in earnings per share and potentially $6 billion in free cash flow."

Nike just finished its ninth positive year in a decade. The stock is up more than 21 percent in the past 12 months as the company benefited from its product innovation and strong online sales. Nike reported stronger-than-expected second-quarter results last month, while boosting its forecast for its current fiscal year.

Cowen predicted Nike could return $24 billion to shareholders over the next five years through share repurchases and dividends, given its strong free cash flow of $4.5 billion annually from the fiscal year of 2019 to 2023.

Product innovation will continue to boost the company's margin as Nike claimed nine pairs of "The 10 Most Anticipated Shoes Of 2019" from Sneaker News, Kernan said.