Nike Inc. (NYSE: NKE) was the worst performing Dow stock in 2016 due to the emergence of its rivals Under Armour Inc. (NYSE: UAA) and Adidas. Although business has picked up for Nike as of late, the company is still facing strong competition from these rivals, especially Adidas, at least according to one key analyst.

Wedbush recently released a report detailing a clear shift to Adidas from Nike. Overall the firm rated Nike with a Neutral rating. Nike does have definite bright spots, particularly on e-commerce, DTC and its lifestyle business.

The firm believes that nothing in Adidas’s fourth-quarter print this morning suggests any immediate change in this shift. To Wedbush, Nike generally lacks new innovation against a consumer preference that is largely skewed toward retro and fashion styles of footwear. This benefits companies like Adidas and Puma.

According to retailers, Adidas continues to have a more compelling pipeline. Also, the success that Adidas is seeing in footwear is translating well to its apparel business providing another growth catalyst.

This morning, Adidas reported fourth-quarter currency neutral (CN) revenue growth of 18%, with the Adidas core brand up 22%. With Adidas updating its long-term growth targets (10% to 12% CAGR in CN sales, 20% to 22% CAGR in net income) through 2020, it is clear Adidas has momentum moving forward. Wedbush expects it to capture market share internationally.

Wedbush further detailed the Nike-Adidas relationship in its report:

Long term outlooks favor Adidas Group. In its latest report, Adidas updated it long-term 2015-2020 outlook. The company expects CN revenues to grow at a CAGR of 10-12% vs. HSD growth previously and net income to increase 20-22% vs. 15% previously. Contrast this outlook with NKE’s long-term outlook (last provided in its March 2015 investor day) in which NKE management predicted annual revenue growth in the high-single to low-double digit range through 2020 to $50 billion (likely ends FY17 at $34.5 billion) and EPS in the mid-teens. With the recent shift in consumer preferences away from Nike’s core products, we are skeptical if these projections for revenue will hold for NKE.

Shares of Nike were last seen at $56.54 on Wednesday, with a consensus analyst price target of $62.00 and a 52-week trading range of $49.01 to $65.44.

Under Armour was down 2.3% at $19.24, with a consensus price target of $22.55 and a 52-week range of $19.18 to $47.95.

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