Exploring NYSE:NKE's dividend characteristics.

Last update: Feb 5, 2024

Consider NIKE INC -CL B (NYSE:NKE) as a top pick for dividend investors, identified by our stock screening tool. NYSE:NKE shines in terms of profitability, solvency, and liquidity, all while paying a decent dividend. Let's dive deeper into the analysis.

Evaluating Dividend: NYSE:NKE

ChartMill provides a Dividend Rating for every stock, ranging from 0 to 10. This rating assesses various dividend aspects, including yield, growth, and sustainability. NYSE:NKE earns a 7 out of 10:

Compared to an average industry Dividend Yield of 2.89, NKE pays a bit more dividend than its industry peers.
The dividend of NKE is nicely growing with an annual growth rate of 11.10%!
NKE has paid a dividend for at least 10 years, which is a reliable track record.
NKE has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
39.61% of the earnings are spent on dividend by NKE. This is a low number and sustainable payout ratio.
The dividend of NKE is growing, but earnings are growing more, so the dividend growth is sustainable.

Looking at the Health

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:NKE, the assigned 7 for health provides valuable insights:

An Altman-Z score of 6.44 indicates that NKE is not in any danger for bankruptcy at the moment.
NKE has a Altman-Z score of 6.44. This is amongst the best in the industry. NKE outperforms 87.76% of its industry peers.
NKE has a debt to FCF ratio of 1.42. This is a very positive value and a sign of high solvency as it would only need 1.42 years to pay back of all of its debts.
NKE has a Debt to FCF ratio of 1.42. This is in the better half of the industry: NKE outperforms 69.39% of its industry peers.
Although NKE does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
NKE has a Current Ratio of 2.74. This indicates that NKE is financially healthy and has no problem in meeting its short term obligations.
NKE's Current ratio of 2.74 is fine compared to the rest of the industry. NKE outperforms 63.27% of its industry peers.
Looking at the Quick ratio, with a value of 1.85, NKE is in the better half of the industry, outperforming 73.47% of the companies in the same industry.

A Closer Look at Profitability for NYSE:NKE

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NYSE:NKE, the assigned 8 is a significant indicator of profitability:

The Return On Assets of NKE (14.24%) is better than 93.88% of its industry peers.
NKE has a Return On Equity of 37.46%. This is amongst the best in the industry. NKE outperforms 93.88% of its industry peers.
Looking at the Return On Invested Capital, with a value of 18.55%, NKE belongs to the top of the industry, outperforming 91.84% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for NKE is significantly above the industry average of 10.49%.
Looking at the Profit Margin, with a value of 10.28%, NKE belongs to the top of the industry, outperforming 89.80% of the companies in the same industry.
NKE's Profit Margin has improved in the last couple of years.
NKE has a better Operating Margin (11.76%) than 83.67% of its industry peers.

More Best Dividend stocks can be found in our Best Dividend screener.

For an up to date full fundamental analysis you can check the fundamental report of NKE

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.