Nike is scheduled to report earnings after Thursday’s close. The stock hit a record high of $179.10/share in 2021 and is currently trading near $76. The stock is prone to big moves after reporting earnings and can easily gap up if the numbers are strong. Conversely, if the numbers disappoint, the stock can easily gap down. To help you prepare, here is what the Street is expecting:
Earnings Preview
The company is expected to report a gain of $0.63/share on $12.17 billion in revenue. Meanwhile, the so-called Whisper number is a gain of $0.60/share. The Whisper number is the Street’s unofficial view on earnings.
A Closer Look At The Fundamentals
The company’s earnings have grown nicely over the last few years. In 2020, the company earned $1.84/share. In 2021, earnings jumped to $3.56. Then, in 2022 earnings came in at $3.75. In 2023, earnings slid a little to $3.23. This year, earnings are expected to grow to $3.95 and then slide again in 2025 to $2.66. In 2026 earnings are expected to come in at $3.06. Clearly, there is not a lot of strong growth going forward and that will be one question investors will be asking going forward.
A Closer Look At The Technicals
Technically, the stock has been under pressure for the last few years. Even this year, the stock market is up nicely but the stock is down. Stepping back the stock is down nearly 40% from its 52-week high, and down more from its record high. The bulls want to see the stock rally after earnings are announced and are looking for a bullish catalyst. Meanwhile, the bears want to see the stock gap down and keep falling.
Company Profile
NIKE, Inc., together with its subsidiaries, engages in the design, development, marketing, and sale of athletic footwear, apparel, equipment, accessories, and services worldwide.
The company provides athletic and casual footwear, apparel, and accessories under the NIKE, Jumpman, Converse, Chuck Taylor, All Star, One Star, Star Chevron, and Jack Purcell trademarks.
It also sells a line of performance equipment and accessories comprising bags, sport balls, socks, 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.
In addition, the company markets apparel with licensed college and professional team, and league logos, as well as sells sports apparel; licenses unaffiliated parties to manufacture and sell apparel, digital devices, and applications and other equipment for sports activities under NIKE-owned trademarks; and operates digital platforms, including fitness and activity apps; sport, fitness, and wellness content; and digital services and features in retail stores.
It 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 founded in 1964 and is headquartered in Beaverton, Oregon.
Pay Attention To How The Stock Reacts To The News
From where I sit, the most important trait I look for during earnings season is how the market and a specific company reacts to the news. Remember, always keep your losses small and never argue with the tape.
Disclosure: The stock has been featured in FindLeadingStocks.com where I give members leading stocks that are breaking out and setting up to breakout in real time.