NIKE INC -CL B (NKE) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NKE - US6541061031 - Common Stock
64.33 USD
+0.65 (+1.02%)
64.4997 USD
+0.17 (+0.26%)
NKE gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 46 industry peers in the Textiles, Apparel & Luxury Goods industry. NKE scores excellent points on both the profitability and health parts. This is a solid base for a good stock. NKE is valied quite expensively at the moment, while it does show a decent growth rate. Finally NKE also has an excellent dividend rating. These ratings could make NKE a good candidate for dividend investing.
1. Profitability
1.1 Basic Checks
NKE had positive earnings in the past year.
In the past year NKE had a positive cash flow from operations.
In the past 5 years NKE has always been profitable.
NKE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
NKE has a Return On Assets of 7.75%. This is amongst the best in the industry. NKE outperforms 86.96% of its industry peers.
NKE's Return On Equity of 21.50% is fine compared to the rest of the industry. NKE outperforms 76.09% of its industry peers.
NKE has a better Return On Invested Capital (10.87%) than 73.91% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NKE is above the industry average of 11.99%.
The 3 year average ROIC (16.64%) for NKE is well above the current ROIC(10.87%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.75% | ||
| ROE | 21.5% | ||
| ROIC | 10.87% |
ROA(3y)12.42%
ROA(5y)13.49%
ROE(3y)33.36%
ROE(5y)36.9%
ROIC(3y)16.64%
ROIC(5y)18.07%
1.3 Margins
With an excellent Profit Margin value of 6.23%, NKE belongs to the best of the industry, outperforming 80.43% of the companies in the same industry.
NKE's Profit Margin has been stable in the last couple of years.
NKE's Operating Margin of 7.36% is fine compared to the rest of the industry. NKE outperforms 60.87% of its industry peers.
NKE's Operating Margin has been stable in the last couple of years.
NKE has a Gross Margin of 41.94%. This is in the lower half of the industry: NKE underperforms 60.87% of its industry peers.
In the last couple of years the Gross Margin of NKE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.36% | ||
| PM (TTM) | 6.23% | ||
| GM | 41.94% |
OM growth 3Y-17.6%
OM growth 5Y-0.82%
PM growth 3Y-18.72%
PM growth 5Y0.48%
GM growth 3Y-2.41%
GM growth 5Y-0.32%
2. Health
2.1 Basic Checks
NKE has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, NKE has less shares outstanding
NKE has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, NKE has an improved debt to assets ratio.
2.2 Solvency
NKE has an Altman-Z score of 4.30. This indicates that NKE is financially healthy and has little risk of bankruptcy at the moment.
NKE's Altman-Z score of 4.30 is fine compared to the rest of the industry. NKE outperforms 76.09% of its industry peers.
NKE has a debt to FCF ratio of 2.66. This is a good value and a sign of high solvency as NKE would need 2.66 years to pay back of all of its debts.
The Debt to FCF ratio of NKE (2.66) is better than 69.57% of its industry peers.
A Debt/Equity ratio of 0.59 indicates that NKE is somewhat dependend on debt financing.
NKE's Debt to Equity ratio of 0.59 is on the low side compared to the rest of the industry. NKE is outperformed by 65.22% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 2.66 | ||
| Altman-Z | 4.3 |
ROIC/WACC1.02
WACC10.64%
2.3 Liquidity
A Current Ratio of 2.19 indicates that NKE has no problem at all paying its short term obligations.
The Current ratio of NKE (2.19) is better than 60.87% of its industry peers.
NKE has a Quick Ratio of 1.45. This is a normal value and indicates that NKE is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of NKE (1.45) is better than 80.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.19 | ||
| Quick Ratio | 1.45 |
3. Growth
3.1 Past
The earnings per share for NKE have decreased strongly by -44.44% in the last year.
Measured over the past 5 years, NKE shows a small growth in Earnings Per Share. The EPS has been growing by 3.37% on average per year.
NKE shows a decrease in Revenue. In the last year, the revenue decreased by -7.14%.
NKE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.36% yearly.
EPS 1Y (TTM)-44.44%
EPS 3Y-16.87%
EPS 5Y3.37%
EPS Q2Q%-30%
Revenue 1Y (TTM)-7.14%
Revenue growth 3Y-0.29%
Revenue growth 5Y4.36%
Sales Q2Q%1.13%
3.2 Future
The Earnings Per Share is expected to grow by 16.96% on average over the next years. This is quite good.
Based on estimates for the next years, NKE will show a small growth in Revenue. The Revenue will grow by 4.85% on average per year.
EPS Next Y-22.25%
EPS Next 2Y8.21%
EPS Next 3Y12.8%
EPS Next 5Y16.96%
Revenue Next Year1.74%
Revenue Next 2Y3.46%
Revenue Next 3Y3.94%
Revenue Next 5Y4.85%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 32.99, which means the current valuation is very expensive for NKE.
NKE's Price/Earnings ratio is in line with the industry average.
NKE is valuated rather expensively when we compare the Price/Earnings ratio to 26.15, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 25.43 indicates a quite expensive valuation of NKE.
Based on the Price/Forward Earnings ratio, NKE is valued a bit more expensive than the industry average as 65.22% of the companies are valued more cheaply.
The average S&P500 Price/Forward Earnings ratio is at 36.12. NKE is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.99 | ||
| Fwd PE | 25.43 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, NKE is valued a bit more expensive than 71.74% of the companies in the same industry.
NKE's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.6 | ||
| EV/EBITDA | 21.75 |
4.3 Compensation for Growth
The decent profitability rating of NKE may justify a higher PE ratio.
NKE's earnings are expected to grow with 12.80% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)9.79
EPS Next 2Y8.21%
EPS Next 3Y12.8%
5. Dividend
5.1 Amount
NKE has a Yearly Dividend Yield of 2.67%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.52, NKE pays a better dividend. On top of this NKE pays more dividend than 82.61% of the companies listed in the same industry.
NKE's Dividend Yield is comparable with the S&P500 average which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.67% |
5.2 History
The dividend of NKE is nicely growing with an annual growth rate of 10.70%!
NKE has been paying a dividend for at least 10 years, so it has a reliable track record.
NKE has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.7%
Div Incr Years23
Div Non Decr Years34
5.3 Sustainability
80.59% of the earnings are spent on dividend by NKE. This is not a sustainable payout ratio.
The dividend of NKE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP80.59%
EPS Next 2Y8.21%
EPS Next 3Y12.8%
64.33
+0.65 (+1.02%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryTextiles, Apparel & Luxury Goods
Earnings (Last)
Earnings (Next)
Inst Owners84.27%
Inst Owner Change-2.2%
Ins Owners0.67%
Ins Owner Change1.42%
Market Cap95.09B
Revenue(TTM)46.44B
Net Income(TTM)2.90B
Analysts75
Price Target85.08 (32.26%)
Short Float %3.14%
Short Ratio2.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.67% |
Yearly Dividend1.54
Dividend Growth(5Y)10.7%
DP80.59%
Div Incr Years23
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)42.76%
Min EPS beat(2)7.49%
Max EPS beat(2)78.04%
EPS beat(4)4
Avg EPS beat(4)47.74%
Min EPS beat(4)7.49%
Max EPS beat(4)83.55%
EPS beat(8)8
Avg EPS beat(8)33.55%
EPS beat(12)11
Avg EPS beat(12)30.36%
EPS beat(16)15
Avg EPS beat(16)26.66%
Revenue beat(2)2
Avg Revenue beat(2)3.98%
Min Revenue beat(2)2.46%
Max Revenue beat(2)5.51%
Revenue beat(4)4
Avg Revenue beat(4)2.55%
Min Revenue beat(4)0.86%
Max Revenue beat(4)5.51%
Revenue beat(8)5
Avg Revenue beat(8)0.61%
Revenue beat(12)8
Avg Revenue beat(12)1.35%
Revenue beat(16)11
Avg Revenue beat(16)1.28%
PT rev (1m)3.6%
PT rev (3m)7.23%
EPS NQ rev (1m)-0.11%
EPS NQ rev (3m)-26.12%
EPS NY rev (1m)0%
EPS NY rev (3m)0.07%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.83%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.88%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.99 | ||
| Fwd PE | 25.43 | ||
| P/S | 2.05 | ||
| P/FCF | 31.6 | ||
| P/OCF | 26.97 | ||
| P/B | 7.06 | ||
| P/tB | 7.33 | ||
| EV/EBITDA | 21.75 |
EPS(TTM)1.95
EY3.03%
EPS(NY)2.53
Fwd EY3.93%
FCF(TTM)2.04
FCFY3.16%
OCF(TTM)2.39
OCFY3.71%
SpS31.42
BVpS9.11
TBVpS8.77
PEG (NY)N/A
PEG (5Y)9.79
Graham Number19.99
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.75% | ||
| ROE | 21.5% | ||
| ROCE | 12.94% | ||
| ROIC | 10.87% | ||
| ROICexc | 16.09% | ||
| ROICexgc | 16.55% | ||
| OM | 7.36% | ||
| PM (TTM) | 6.23% | ||
| GM | 41.94% | ||
| FCFM | 6.48% |
ROA(3y)12.42%
ROA(5y)13.49%
ROE(3y)33.36%
ROE(5y)36.9%
ROIC(3y)16.64%
ROIC(5y)18.07%
ROICexc(3y)27.29%
ROICexc(5y)31.4%
ROICexgc(3y)28.17%
ROICexgc(5y)32.46%
ROCE(3y)19.82%
ROCE(5y)21.52%
ROICexgc growth 3Y-18.4%
ROICexgc growth 5Y0.36%
ROICexc growth 3Y-18.27%
ROICexc growth 5Y0.46%
OM growth 3Y-17.6%
OM growth 5Y-0.82%
PM growth 3Y-18.72%
PM growth 5Y0.48%
GM growth 3Y-2.41%
GM growth 5Y-0.32%
F-Score4
Asset Turnover1.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 2.66 | ||
| Debt/EBITDA | 1.89 | ||
| Cap/Depr | 63.83% | ||
| Cap/Sales | 1.11% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 83.36% | ||
| Profit Quality | 103.94% | ||
| Current Ratio | 2.19 | ||
| Quick Ratio | 1.45 | ||
| Altman-Z | 4.3 |
F-Score4
WACC10.64%
ROIC/WACC1.02
Cap/Depr(3y)87.41%
Cap/Depr(5y)87.93%
Cap/Sales(3y)1.47%
Cap/Sales(5y)1.52%
Profit Quality(3y)104.57%
Profit Quality(5y)98.22%
High Growth Momentum
Growth
EPS 1Y (TTM)-44.44%
EPS 3Y-16.87%
EPS 5Y3.37%
EPS Q2Q%-30%
EPS Next Y-22.25%
EPS Next 2Y8.21%
EPS Next 3Y12.8%
EPS Next 5Y16.96%
Revenue 1Y (TTM)-7.14%
Revenue growth 3Y-0.29%
Revenue growth 5Y4.36%
Sales Q2Q%1.13%
Revenue Next Year1.74%
Revenue Next 2Y3.46%
Revenue Next 3Y3.94%
Revenue Next 5Y4.85%
EBIT growth 1Y-45.67%
EBIT growth 3Y-17.84%
EBIT growth 5Y3.51%
EBIT Next Year1.76%
EBIT Next 3Y19.05%
EBIT Next 5Y19.88%
FCF growth 1Y-32.53%
FCF growth 3Y-9.64%
FCF growth 5Y18.49%
OCF growth 1Y-34.92%
OCF growth 3Y-10.67%
OCF growth 5Y8.27%
NIKE INC -CL B / NKE FAQ
What is the fundamental rating for NKE stock?
ChartMill assigns a fundamental rating of 6 / 10 to NKE.
What is the valuation status for NKE stock?
ChartMill assigns a valuation rating of 2 / 10 to NIKE INC -CL B (NKE). This can be considered as Overvalued.
How profitable is NIKE INC -CL B (NKE) stock?
NIKE INC -CL B (NKE) has a profitability rating of 7 / 10.
What is the earnings growth outlook for NIKE INC -CL B?
The Earnings per Share (EPS) of NIKE INC -CL B (NKE) is expected to decline by -22.25% in the next year.
Can you provide the dividend sustainability for NKE stock?
The dividend rating of NIKE INC -CL B (NKE) is 7 / 10 and the dividend payout ratio is 80.59%.