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Nike (NKE) Gains But Lags Market: What You Should Know

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Nike (NKE - Free Report) closed the most recent trading day at $75.58, moving +1.86% from the previous trading session. This change lagged the S&P 500's 9.28% gain on the day. Meanwhile, the Dow gained 9.36%, and the Nasdaq, a tech-heavy index, added 9.34%.

Coming into today, shares of the athletic apparel maker had lost 28.22% in the past month. In that same time, the Consumer Discretionary sector lost 31.11%, while the S&P 500 lost 26.56%.

NKE will be looking to display strength as it nears its next earnings release, which is expected to be March 24, 2020. In that report, analysts expect NKE to post earnings of $0.62 per share. This would mark a year-over-year decline of 8.82%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $10.03 billion, up 4.32% from the year-ago period.

NKE's full-year Zacks Consensus Estimates are calling for earnings of $2.86 per share and revenue of $41.76 billion. These results would represent year-over-year changes of +14.86% and +6.76%, respectively.

Any recent changes to analyst estimates for NKE should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 4.39% lower. NKE is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, NKE currently has a Forward P/E ratio of 25.91. This valuation marks a premium compared to its industry's average Forward P/E of 12.29.

It is also worth noting that NKE currently has a PEG ratio of 1.86. 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 1.11 as of yesterday's close.

The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 164, which puts it in the bottom 36% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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