It has been a difficult year for Nike shareholders. And now Wall Street is saying the company's financial results will get "worse before better."



JPMorgan analyst Matthew Boss told investors Nike sales will weaken and the company will miss earnings expectations next year in a note to clients Friday. As a result, he lowered his rating for Nike to neutral from overweight.



Nike announced plans to cut 2 percent of its workforce Thursday.

"Putting the pieces together, we are encouraged by mgmt's more efficient SG&A [selling, general and administrative expenses] approach (i.e. 2% global workforce reduction) and forward thinking initiatives (speed/innovation), but change takes time with N/A marketplace disruption and elevated promotional activity pressuring mgmt's mid-teens algorithm," Boss wrote in the report. "Based on our work, we see the N. America top-line picture likely worse before better modeling flat N/A revenues in FY18."



Nike underperformed the market in the previous 12 months with its shares down 1 percent through Thursday compared to the S&P 500's 17 percent return.

The analyst lowered his price target for Nike to $58 from $61, representing 10 percent upside from Thursday's close.



Boss cited how approximately 50 percent of Nike's sales are generated in North America and sales in this geography grew only 3 percent in the past year versus the 12 percent growth average in the previous four years.