NIKE INC -CL B (NKE) Stock Fundamental Analysis
NYSE:NKE - New York Stock Exchange, Inc. - US6541061031 - Common Stock
NKE gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 50 industry peers in the Textiles, Apparel & Luxury Goods industry. NKE has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. NKE does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year NKE was profitable.
In the past year NKE had a positive cash flow from operations.
Each year in the past 5 years NKE has been profitable.
Each year in the past 5 years NKE had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 12.87%, NKE belongs to the best of the industry, outperforming 89.80% of the companies in the same industry.
NKE has a Return On Equity of 34.81%. This is amongst the best in the industry. NKE outperforms 91.84% of its industry peers.
With an excellent Return On Invested Capital value of 18.25%, NKE belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for NKE is significantly above the industry average of 11.39%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.87% | ||
| ROE | 34.81% | ||
| ROIC | 18.25% |
ROA(3y)14.49%
ROA(5y)13.35%
ROE(3y)38.42%
ROE(5y)38.33%
ROIC(3y)18.84%
ROIC(5y)17.81%
1.3 Margins
With an excellent Profit Margin value of 9.98%, NKE belongs to the best of the industry, outperforming 87.76% 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 (11.95%) than 83.67% of its industry peers.
NKE's Operating Margin has been stable in the last couple of years.
NKE has a Gross Margin of 44.60%. This is comparable to the rest of the industry: NKE outperforms 42.86% of its industry peers.
NKE's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.95% | ||
| PM (TTM) | 9.98% | ||
| GM | 44.6% |
OM growth 3Y-6.89%
OM growth 5Y1.32%
PM growth 3Y-4.79%
PM growth 5Y1.5%
GM growth 3Y-0.25%
GM growth 5Y-0.05%
2. Health
2.1 Basic Checks
NKE has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for NKE has been reduced compared to 1 year ago.
The number of shares outstanding for NKE has been reduced compared to 5 years ago.
The debt/assets ratio for NKE has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.88 indicates that NKE is not in any danger for bankruptcy at the moment.
The Altman-Z score of NKE (4.88) is better than 81.63% of its industry peers.
NKE has a debt to FCF ratio of 1.64. This is a very positive value and a sign of high solvency as it would only need 1.64 years to pay back of all of its debts.
NKE's Debt to FCF ratio of 1.64 is fine compared to the rest of the industry. NKE outperforms 71.43% of its industry peers.
NKE has a Debt/Equity ratio of 0.57. This is a neutral value indicating NKE is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.57, NKE is not doing good in the industry: 61.22% of the companies in the same industry are doing better.
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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 1.64 | ||
| Altman-Z | 4.88 |
ROIC/WACC2.07
WACC8.82%
2.3 Liquidity
A Current Ratio of 2.22 indicates that NKE has no problem at all paying its short term obligations.
NKE has a Current ratio (2.22) which is comparable to the rest of the industry.
A Quick Ratio of 1.51 indicates that NKE should not have too much problems paying its short term obligations.
NKE has a Quick ratio of 1.51. This is in the better half of the industry: NKE outperforms 73.47% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.22 | ||
| Quick Ratio | 1.51 |
3. Growth
3.1 Past
NKE shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -4.68%.
NKE shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.53% yearly.
The Revenue has decreased by -4.97% in the past year.
The Revenue has been growing slightly by 5.60% on average over the past years.
EPS 1Y (TTM)-4.68%
EPS 3Y1.75%
EPS 5Y8.53%
EPS Q2Q%-24.27%
Revenue 1Y (TTM)-4.97%
Revenue growth 3Y4.87%
Revenue growth 5Y5.6%
Sales Q2Q%-7.72%
3.2 Future
The Earnings Per Share is expected to grow by 1.75% on average over the next years.
The Revenue is expected to grow by 1.88% on average over the next years.
EPS Next Y-26.53%
EPS Next 2Y-7.9%
EPS Next 3Y-0.96%
EPS Next 5Y1.75%
Revenue Next Year-10.85%
Revenue Next 2Y-4.79%
Revenue Next 3Y-1.55%
Revenue Next 5Y1.88%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 22.44, the valuation of NKE can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of NKE is on the same level as its industry peers.
NKE's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.29.
With a Price/Forward Earnings ratio of 23.00, NKE is valued on the expensive side.
NKE's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 24.44. NKE is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.44 | ||
| Fwd PE | 23 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as NKE.
The rest of the industry has a similar Price/Free Cash Flow ratio as NKE.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.74 | ||
| EV/EBITDA | 15.37 |
4.3 Compensation for Growth
NKE has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.63
EPS Next 2Y-7.9%
EPS Next 3Y-0.96%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.25%, NKE has a reasonable but not impressive dividend return.
NKE's Dividend Yield is rather good when compared to the industry average which is at 2.84. NKE pays more dividend than 81.63% of the companies in the same industry.
NKE's Dividend Yield is comparable with the S&P500 average which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.25% |
5.2 History
On average, the dividend of NKE grows each year by 11.20%, which is quite nice.
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)11.2%
Div Incr Years23
Div Non Decr Years34
5.3 Sustainability
NKE pays out 45.78% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of NKE is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP45.78%
EPS Next 2Y-7.9%
EPS Next 3Y-0.96%
NIKE INC -CL B
NYSE:NKE (1/21/2025, 8:17:03 PM)
After market: 73.2488 +0.08 (+0.11%)73.17
+2.33 (+3.29%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryTextiles, Apparel & Luxury Goods
Earnings (Last)
Earnings (Next)
Inst Owners83.67%
Inst Owner Change0.2%
Ins Owners0.67%
Ins Owner Change18.63%
Market Cap108.91B
Analysts73.48
Price Target89.72 (22.62%)
Short Float %2.38%
Short Ratio2.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.25% |
Yearly Dividend1.43
Dividend Growth(5Y)11.2%
DP45.78%
Div Incr Years23
Div Non Decr Years34
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)25.74%
Min EPS beat(2)18.21%
Max EPS beat(2)33.27%
EPS beat(4)4
Avg EPS beat(4)18.76%
Min EPS beat(4)3.59%
Max EPS beat(4)33.27%
EPS beat(8)7
Avg EPS beat(8)20.1%
EPS beat(12)11
Avg EPS beat(12)18.61%
EPS beat(16)15
Avg EPS beat(16)22.17%
Revenue beat(2)1
Avg Revenue beat(2)-0.62%
Min Revenue beat(2)-1.47%
Max Revenue beat(2)0.23%
Revenue beat(4)2
Avg Revenue beat(4)-0.96%
Min Revenue beat(4)-2.81%
Max Revenue beat(4)0.23%
Revenue beat(8)4
Avg Revenue beat(8)0.17%
Revenue beat(12)8
Avg Revenue beat(12)0.88%
Revenue beat(16)9
Avg Revenue beat(16)0.74%
PT rev (1m)-3.64%
PT rev (3m)-4.65%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-36.01%
EPS NY rev (1m)0%
EPS NY rev (3m)-11.96%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-9.73%
Revenue NY rev (1m)-2.82%
Revenue NY rev (3m)-5.66%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.44 | ||
| Fwd PE | 23 | ||
| P/S | 2.22 | ||
| P/FCF | 19.74 | ||
| P/OCF | 17.79 | ||
| P/B | 7.76 | ||
| P/tB | 8.05 | ||
| EV/EBITDA | 15.37 |
EPS(TTM)3.26
EY4.46%
EPS(NY)3.18
Fwd EY4.35%
FCF(TTM)3.71
FCFY5.07%
OCF(TTM)4.11
OCFY5.62%
SpS32.9
BVpS9.43
TBVpS9.1
PEG (NY)N/A
PEG (5Y)2.63
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.87% | ||
| ROE | 34.81% | ||
| ROCE | 21.91% | ||
| ROIC | 18.25% | ||
| ROICexc | 28.72% | ||
| ROICexgc | 29.59% | ||
| OM | 11.95% | ||
| PM (TTM) | 9.98% | ||
| GM | 44.6% | ||
| FCFM | 11.27% |
ROA(3y)14.49%
ROA(5y)13.35%
ROE(3y)38.42%
ROE(5y)38.33%
ROIC(3y)18.84%
ROIC(5y)17.81%
ROICexc(3y)32.19%
ROICexc(5y)31.11%
ROICexgc(3y)33.27%
ROICexgc(5y)32.18%
ROCE(3y)22.6%
ROCE(5y)21.38%
ROICexcg growth 3Y-5.31%
ROICexcg growth 5Y-0.47%
ROICexc growth 3Y-5.19%
ROICexc growth 5Y-0.31%
OM growth 3Y-6.89%
OM growth 5Y1.32%
PM growth 3Y-4.79%
PM growth 5Y1.5%
GM growth 3Y-0.25%
GM growth 5Y-0.05%
F-Score6
Asset Turnover1.29
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.57 | ||
| Debt/FCF | 1.64 | ||
| Debt/EBITDA | 1.2 | ||
| Cap/Depr | 71.79% | ||
| Cap/Sales | 1.23% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 91.44% | ||
| Profit Quality | 112.94% | ||
| Current Ratio | 2.22 | ||
| Quick Ratio | 1.51 | ||
| Altman-Z | 4.88 |
F-Score6
WACC8.82%
ROIC/WACC2.07
Cap/Depr(3y)99.75%
Cap/Depr(5y)107.42%
Cap/Sales(3y)1.7%
Cap/Sales(5y)1.91%
Profit Quality(3y)95.15%
Profit Quality(5y)88.93%
High Growth Momentum
Growth
EPS 1Y (TTM)-4.68%
EPS 3Y1.75%
EPS 5Y8.53%
EPS Q2Q%-24.27%
EPS Next Y-26.53%
EPS Next 2Y-7.9%
EPS Next 3Y-0.96%
EPS Next 5Y1.75%
Revenue 1Y (TTM)-4.97%
Revenue growth 3Y4.87%
Revenue growth 5Y5.6%
Sales Q2Q%-7.72%
Revenue Next Year-10.85%
Revenue Next 2Y-4.79%
Revenue Next 3Y-1.55%
Revenue Next 5Y1.88%
EBIT growth 1Y-3.43%
EBIT growth 3Y-2.36%
EBIT growth 5Y6.99%
EBIT Next Year-33.7%
EBIT Next 3Y-3.69%
EBIT Next 5Y3.14%
FCF growth 1Y209.65%
FCF growth 3Y3.54%
FCF growth 5Y6.7%
OCF growth 1Y128.57%
OCF growth 3Y3.73%
OCF growth 5Y4.71%