NIKE (NYSE:NKE) Shares Gap Up Following Better-Than-Expected Earnings

Key Points

• NIKE, Inc. reported earnings of $0.49 per share, significantly exceeding the consensus estimate of $0.27, and quarterly revenues reached $11.72 billion, above expectations of $10.96 billion.
• The company declared a quarterly dividend of $0.40 per share, representing an annual yield of 2.2%, with a payout ratio of 74.07%.
• Analysts are optimistic about NIKE, with a consensus rating of "Moderate Buy" and a target price of $80.19, reflecting upgrades from several firms including Royal Bank of Canada and Citigroup.

Shares of NIKE, Inc. (NYSE:NKE - Get Free Report) gapped up before the market opened on Wednesday following a stronger than expected earnings report. The stock had previously closed at $69.73, but opened at $74.35. NIKE shares last traded at $71.94, with a volume of 14,064,968 shares trading hands.

The footwear maker reported $0.49 earnings per share for the quarter, topping the consensus estimate of $0.27 by $0.22. NIKE had a return on equity of 23.33% and a net margin of 6.95%.The firm had revenue of $11.72 billion during the quarter, compared to analysts' expectations of $10.96 billion. During the same period in the prior year, the company earned $0.70 earnings per share. The company's quarterly revenue was up 1.0% on a year-over-year basis.

NIKE Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, October 1st. Stockholders of record on Tuesday, September 2nd will be paid a $0.40 dividend. This represents a $1.60 dividend on an annualized basis and a dividend yield of 2.2%. The ex-dividend date is Tuesday, September 2nd. NIKE's dividend payout ratio (DPR) is presently 74.07%.

Wall Street Analyst Weigh In

Several equities analysts have commented on the company. Zacks Research upgraded NIKE from a "strong sell" rating to a "hold" rating in a research report on Tuesday, August 26th. Royal Bank Of Canada raised shares of NIKE from a "sector perform" rating to an "outperform" rating and boosted their price objective for the stock from $76.00 to $90.00 in a research note on Thursday, September 18th. Wall Street Zen raised NIKE from a "sell" rating to a "hold" rating in a research report on Saturday, September 6th. Citigroup raised NIKE from a "neutral" rating to a "positive" rating in a research note on Friday, September 19th. Finally, Morgan Stanley set a $72.00 target price on NIKE and gave the company a "positive" rating in a report on Wednesday. Three research analysts have rated the stock with a Strong Buy rating, twenty-two have given a Buy rating and eight have given a Hold rating to the company. Based on data from MarketBeat, NIKE presently has a consensus rating of "Moderate Buy" and a consensus target price of $80.19.

Insider Buying and Selling

In related news, Chairman Mark G. Parker sold 110,000 shares of NIKE stock in a transaction that occurred on Wednesday, July 16th. The shares were sold at an average price of $72.29, for a total value of $7,951,900.00. Following the completion of the transaction, the chairman directly owned 842,361 shares in the company, valued at approximately $60,894,276.69. The trade was a 11.55% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Company insiders own 0.80% of the company's stock.

Hedge Funds Weigh In On NIKE

A number of institutional investors have recently added to or reduced their stakes in NKE. Spire Wealth Management raised its position in shares of NIKE by 4.4% during the 1st quarter. Spire Wealth Management now owns 9,872 shares of the footwear maker's stock valued at $627,000 after buying an additional 416 shares in the last quarter. Bank Julius Baer & Co. Ltd Zurich boosted its holdings in shares of NIKE by 0.6% in the 1st quarter. Bank Julius Baer & Co. Ltd Zurich now owns 1,008,340 shares of the footwear maker's stock worth $69,932,000 after purchasing an additional 5,601 shares in the last quarter. Clal Insurance Enterprises Holdings Ltd purchased a new position in shares of NIKE during the 1st quarter valued at about $25,963,000. BROOKFIELD Corp ON raised its stake in shares of NIKE by 36.2% during the first quarter. BROOKFIELD Corp ON now owns 658,598 shares of the footwear maker's stock worth $41,808,000 after acquiring an additional 175,000 shares in the last quarter. Finally, Olstein Capital Management L.P. lifted its holdings in shares of NIKE by 42.2% in the 1st quarter. Olstein Capital Management L.P. now owns 91,000 shares of the footwear maker's stock worth $5,777,000 after acquiring an additional 27,000 shares during the last quarter. 64.25% of the stock is currently owned by institutional investors.

NIKE Stock Performance

The company has a current ratio of 2.21, a quick ratio of 1.50 and a debt-to-equity ratio of 0.60. The company has a market cap of $108.07 billion, a P/E ratio of 33.80, a price-to-earnings-growth ratio of 2.54 and a beta of 1.24. The company's fifty day moving average is $74.78 and its 200 day moving average is $67.27.

NIKE Company Profile

NIKE, Inc, together with its subsidiaries, designs, develops, markets, and sells athletic footwear, apparel, equipment, accessories, and services 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.

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