Back to top

Analyst Blog

In an attempt to enhance shareholder value, Nike, Inc. (NKE - Analyst Report) recently hiked the quarterly dividend on its Class A and B shares by 14% to 24 cents per share. The company’s annual dividend now stands at 96 cents.

The new dividend is payable on Jan 6, 2014 to shareholders of record as of Dec 16, 2013. The enhancement in the dividend is attributable to Nike’s strong performance during the year, with the stock price jumping nearly 52.2% year to date.

This is the twelfth consecutive year of Nike’s annual dividend increase, depicting its commitment towards enhancing stockholder value.

This global sport equipment and apparel retailer has been consistently paying dividend since 1984. The company last hiked its quarterly dividend to 21 cents from 18 cents in 2012, reflecting an increase of approximately 16.7%.

Dividend hike is quiet frequent among companies with a stable cash position and healthy cash flow. Apart from Nike, many other firms have raised their quarterly dividends in the recent past. These include Snap-on Inc. (SNA - Analyst Report), Sysco Corporation (SYY - Analyst Report) and Halliburton Company (HAL - Analyst Report) that raised their dividends by 15.8% to 44 cents, 3.6% to 29 cents and 20% to 15 cents, respectively.

Dividend hikes not only enhance shareholder’s return but raise the market value of the stock. Through this strategy, the companies bolster investors’ confidence on the stock, thereby persuading them to either buy or hold the scrip instead of selling them. Looking ahead, Nike remains confident of its growth potential, suggesting enhanced value for shareholders.

This Oregon based retailer, is expected to announce its second-quarter fiscal 2014 earnings on Dec 19, 2013. Our proven model doesn’t conclusively show that Nike is likely to beat the Zacks Consensus Estimate this quarter. This is because the company carries a Zacks Rank #2 (Buy) and an Earnings ESP of 0.00% and for a stock to outperform, it needs both a positive Earnings ESP and a Zacks Rank of #1, 2 or 3.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
QIHOO 360 T… QIHU 95.04 +4.95%
PILGRIM'S P… PPC 31.52 +3.72%
CLAYTON WIL… CWEI 138.97 +3.55%
FLAMEL TECH… FLML 14.02 +3.16%
CALLON PETE… CPE 11.50 +3.14%