Nike (NKE) AI Stock Analysis

• Market Cap: $85.05B
• Dividend Yield: 2.67%
• Average Volume (3M): 26.57M
• Price to Earnings (P/E): 19.2
• Beta (1Y): 0.69
• Revenue Growth: -7.11%
• EPS Growth: -12.12%
• Country: US
• Employees: 79,400
• Sector: Consumer Cyclical
• Sector Strength: 66
• Industry: Apparel - Footwear & Accessories
• EPS (TTM): 3.00
• Shares Outstanding: 1,178,102,800
• 10 Day Avg. Volume: 19,242,880
• 30 Day Avg. Volume: 26,569,778
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.78
• Price to Cash Flow (P/CF): 24.00
• P/FCF Ratio: 16.01
• Enterprise Value/Market Cap: 1.40
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 5.20
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $80.74
• Price Target Upside: 40.12% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 31

Nike's overall score reflects a mixed outlook, with strong financial health and strategic initiatives offset by technical weakness and revenue challenges. The company's robust balance sheet and profitability provide a solid foundation, but the recent market performance and execution risks in key markets like Greater China weigh on the score. Valuation remains fair, suggesting potential for long-term appreciation if growth initiatives succeed.

Positive Factors

Innovation and Sales

Continued inventory cleanup actions are expected to lead to robust innovation and a positive sales inflection for Nike.

Market Position

Nike remains the #1 brand in a growing category, with valuation at decade-old levels.

Supply Chain Management

Nike's diversified supply chain helps manage tariff pressures, reducing potential negative impacts on the company's margins.

Negative Factors

Consumer Preferences

Chinese consumers' reduced appetite for global brands presents a risk for Nike, as evidenced by past boycotts impacting growth.

Geopolitical Challenges

Nike's growth in China has slowed significantly due to geopolitical tensions, impacting the company's overall performance.

Inventory Management

Nike has been struggling with inventory management challenges, and any prolonged inventory issue could have a longer than expected impact on its sales trend.

Nike Business Overview & Revenue Model

Company Description

NIKE, Inc., together with its subsidiaries, designs, develops, markets, and sells men's, women's, and kids athletic footwear, apparel, equipment, and accessories worldwide. The company provides athletic and casual footwear, apparel, and accessories under the Jumpman trademark; and casual sneakers, apparel, and accessories under the Converse, Chuck Taylor, All Star, One Star, Star Chevron, and Jack Purcell trademarks. In addition, it sells a line of performance equipment and accessories comprising bags, socks, sport balls, eyewear, timepieces, digital devices, bats, gloves, protective equipment, and other equipment for sports activities under the NIKE brand; and various plastic products to other manufacturers. The company markets apparel with licensed college and professional team, and league logos, as well as sells sports apparel. Additionally, it licenses unaffiliated parties to manufacture and sell apparel, digital devices, and applications and other equipment for sports activities under NIKE-owned trademarks. The company sells its products to footwear stores; sporting goods stores; athletic specialty stores; department stores; skate, tennis, and golf shops; and other retail accounts through NIKE-owned retail stores, digital platforms, independent distributors, licensees, and sales representatives. The company was formerly known as Blue Ribbon Sports, Inc. and changed its name to NIKE, Inc. in 1971. NIKE, Inc. was founded in 1964 and is headquartered in Beaverton, Oregon.

How the Company Makes Money

Nike makes money primarily through the sale of its athletic footwear, apparel, and equipment. The company's revenue model is centered around a combination of direct-to-consumer sales via its online platforms and physical retail stores, as well as wholesale distribution to third-party retailers. Key revenue streams include sales from its flagship Nike brand, as well as subsidiary brands like Converse and Jordan. Additionally, Nike benefits from strategic partnerships and endorsements with high-profile athletes and sports teams, which enhance its brand visibility and drive consumer demand. The company's earnings are further supported by its investments in marketing and product innovation, which help maintain its competitive edge in the global sportswear market.

Nike Financial Statement Overview

Summary

Nike demonstrates strong financial health with robust profitability and efficient cash flow management, though recent revenue contraction warrants attention. The balance sheet stability is a significant strength, with no leverage concerns. Continued focus on revenue growth will be critical to maintaining its financial momentum.

Income Statement

Nike's income statement shows a strong gross profit margin of 43.8% for TTM, indicating robust cost management and pricing power. However, a decrease in revenue from the previous fiscal year by 6.9% raises concerns. The net profit margin stands at 9.4%, reflecting solid profitability despite the revenue drop. The EBIT margin of 10.4% further corroborates Nike's operational efficiency.

Balance Sheet

The balance sheet reveals a healthy equity ratio of 100%, indicating strong financial stability and no leverage, as liabilities and equity are balanced. The debt-to-equity ratio is not applicable due to the equity matching assets, highlighting no financial leverage concerns. Return on equity stands at 11.9%, showing efficient use of shareholder funds.

Cash Flow

Nike's cash flow statement indicates a free cash flow growth of 9% from the previous fiscal year, showcasing effective cash management. The operating cash flow to net income ratio is 1.3, suggesting good cash conversion. However, the free cash flow to net income ratio of 1.18 points to some discrepancies between accounting profit and cash generation.

Breakdown
Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
51.36B	51.22B	46.71B	44.54B	37.40B
	Gross Profit
22.89B	22.29B	21.48B	19.96B	16.24B
	EBIT
6.69B	5.06B	5.83B	6.14B	2.00B
	EBITDA
7.16B	6.77B	7.51B	7.73B	4.23B
	Net Income Common Stockholders
5.70B	5.07B	6.05B	5.73B	2.54B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
11.58B	10.68B	13.00B	13.48B	8.79B
	Total Assets
38.11B	37.53B	40.32B	37.74B	31.34B
	Total Debt
11.95B	12.14B	12.63B	12.81B	13.02B
	Net Debt
2.09B	4.70B	4.05B	2.92B	4.67B
	Total Liabilities
23.68B	23.53B	25.04B	24.97B	23.29B
	Stockholders Equity
14.43B	14.00B	15.28B	12.77B	8.05B
Cash Flow		Free Cash Flow
6.62B	4.87B	4.43B	5.96B	1.40B
	Operating Cash Flow
7.43B	5.84B	5.19B	6.66B	2.48B
	Investing Cash Flow
894.00M	564.00M	-1.52B	-3.80B	-1.03B
	Financing Cash Flow
-5.89B	-7.45B	-4.84B	-1.46B	2.49B

Nike Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 57.62
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NKE, the sentiment is Negative. The current price of 57.62 is below the 20-day moving average (MA) of 57.63, below the 50-day MA of 67.77, and below the 200-day MA of 74.62, indicating a bearish trend. The MACD of -3.00 indicates Negative momentum. The RSI at 42.70 is Neutral, neither overbought nor oversold. The STOCH value of 78.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NKE.

Nike Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DECK	83 Outperform	$16.57B	17.72	39.80%	―	19.40%	32.70%
CROX	81 Outperform	$5.48B	6.11	57.76%	―	3.53%	24.55%
BIRK	75 Outperform	$9.52B	40.13	8.52%	―	20.40%	134.09%
SKX	73 Outperform	$7.44B	11.92	14.67%	―	10.66%	9.44%
SHOO	70 Outperform	$1.51B	8.84	20.20%	4.04%	15.03%	1.51%
NKE	61 Neutral	$85.05B	19.17	31.93%	2.67%	-7.11%	-12.12%
Sector *	60 Neutral	$6.85B	11.71	3.16%	4.15%	2.39%	-21.87%

Nike Corporate Events

Nike Secures New Credit Agreements with Bank of America

On March 7, 2025, Nike, Inc. entered into two significant credit agreements with Bank of America and other financial institutions. The first is a 364-Day Credit Agreement providing up to $1 billion for working capital and general corporate purposes, with the option to increase the facility to $1.5 billion. The second is a Five Year Credit Agreement offering up to $2 billion, extendable to $3 billion, also for general corporate purposes. Both agreements allow for borrowings in multiple currencies and include covenants limiting certain corporate activities. Concurrently, Nike terminated prior credit agreements of similar nature, with no outstanding amounts as of the termination date.