Nike [linkme to=”NKE”] stock has gained this afternoon as Craig Zanon was named VP and general manager of Nike Global Basketball earlier this week.
The stock went up by over 0.5% during the mid morning trading session but however, is still up by 0.34% at noon after a little slip in the late morning trading session.
Near term, the company will likely see sales deceleration while competitors Under Armour and Adidas gain footwear momentum for the first time in years, Credit Suisse wrote in a note released yesterday. Nike will also be facing challenges with pinnacle basketball products in terms of pricing.
Nike should benefit from global share capture for athletic apparel and footwear in the soft lines marketplace and from global roll-out of category offense and integrated marketplace strategies that “facilitate more profitable revenue capture,” the firm contended.
In the most recent quarter, Nike Inc has improved earnings per share by 23.6% compare to the same quarter a year ago. The company has exhibited a pattern of positive earnings per share growth over the past two years.
During last fiscal year, Nike Inc increased its bottom line by earning $1.85 versus $1.49 in the prior year.
This year, the market expects an improvement in earnings ($2.15 versus $1.85). On account of net income growth from the same quarter one year ago, the company has undeniably outperformed against the S&P 500 and outpaced that of the Textiles, Apparel & Luxury Goods industry average.
Compared to the same quarter one on year prior, the net income upturned, going from $791.00 million to $950.00 million.
However, on the other hand, even with its growing revenue, the company under performed as compared with the industry average of 14.7%. Since the same quarter one year prior, revenues slightly increased by 7.7%. Growth in the company’s revenue appears to have helped boost the earnings per share. Nike’s debt-to-equity ratio is very low at 0.17 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
On top of that, Nike has a quick ratio of 1.73, which demonstrates the ability of the company to cover short-term liquidity needs. Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. When compared to other companies in the Textiles, Apparel & Luxury Goods industry and the overall market, Nike Inc ‘s return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
Nike Inc‘s gross profit margin for the third quarter of its fiscal year 2015 is essentially unchanged when compared to the same period a year ago. The company has raised its sales and net income during the past quarter when compared with the same quarter a year ago, and despite its growth in net income has outdo the industry average, its revenue growth has not. Nike Inc has strong liquidity. Currently, the Quick Ratio is 1.73 which shows the ability to cover short-term cash needs. Moreover, the company’s liquidity has increased from the same period last year.