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Nike (NKE) Rises Higher Than Market: Key Facts

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Nike (NKE - Free Report) closed at $71.34 in the latest trading session, marking a +0.56% move from the prior day. The stock exceeded the S&P 500, which registered a gain of 0.03% for the day. At the same time, the Dow added 0.28%, and the tech-heavy Nasdaq lost 0.36%.

The athletic apparel maker's stock has dropped by 1.58% in the past month, falling short of the Consumer Discretionary sector's gain of 7.22% and the S&P 500's gain of 4.19%.

Analysts and investors alike will be keeping a close eye on the performance of Nike in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $0.28, reflecting a 71.43% decrease from the same quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $11.15 billion, reflecting a 10.31% fall from the equivalent quarter last year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $2.05 per share and revenue of $46.32 billion, indicating changes of -48.1% and -9.81%, respectively, compared to the previous year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Nike. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 2.48% downward. Nike currently has a Zacks Rank of #5 (Strong Sell).

In terms of valuation, Nike is presently being traded at a Forward P/E ratio of 34.66. This expresses a premium compared to the average Forward P/E of 14.4 of its industry.

We can also see that NKE currently has a PEG ratio of 2.31. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Shoes and Retail Apparel industry currently had an average PEG ratio of 1.72 as of yesterday's close.

The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This industry, currently bearing a Zacks Industry Rank of 210, finds itself in the bottom 17% echelons of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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