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In the latest market close, Nike (NKE) reached $76.50, with a -0.95% movement compared to the previous day. The stock's change was more than the S&P 500's daily loss of 1.71%. Elsewhere, the Dow lost 1.7%, while the tech-heavy Nasdaq lost 2.2%.
Heading into today, shares of the athletic apparel maker had gained 3.96% over the past month, lagging the Consumer Discretionary sector's gain of 13.7% and outpacing the S&P 500's gain of 2.2% in that time.
The investment community will be paying close attention to the earnings performance of Nike in its upcoming release. The company is predicted to post an EPS of $0.28, indicating a 71.43% decline compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $11.15 billion, down 10.31% from the year-ago period.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $2.05 per share and a revenue of $46.32 billion, indicating changes of -48.1% and -9.81%, respectively, from the former year.
Investors might also notice recent changes to analyst estimates for Nike. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 2.32% decrease. Right now, Nike possesses a Zacks Rank of #4 (Sell).
Looking at valuation, Nike is presently trading at a Forward P/E ratio of 37.73. Its industry sports an average Forward P/E of 13.8, so one might conclude that Nike is trading at a premium comparatively.
It's also important to note that NKE currently trades at a PEG ratio of 2.52. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Shoes and Retail Apparel industry currently had an average PEG ratio of 1.82 as of yesterday's close.
The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This industry, currently bearing a Zacks Industry Rank of 218, finds itself in the bottom 14% echelons of all 250+ industries.