Fact based stock research
NIKE (NYSE:NKE)
US6541061031
How to read the free ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
NIKE stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 9 (worse than 91% compared with investment alternatives), NIKE (Footwear, USA) shares have lower financial characteristics compared with similar stocks. Shares of NIKE are low in value (priced high) with a consolidated Value Rank of 15 (worse than 85% of alternatives) and show below-average growth (Growth Rank of 23) but are safely financed (Safety Rank of 55), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 9, is a sell recommendation based on NIKE's financial characteristics. As the company NIKE's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 15) and low growth (Obermatt Growth Rank of 23), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 55) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | USA |
| Industry | Footwear |
| Index | Dow Jones, S&P US Luxury, S&P 500 |
| Size class | XX-Large |
19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: NIKE
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 4 |
|
11 |
|
7 |
|
15 |
|
| GROWTH | ||||||||
| GROWTH | 21 |
|
41 |
|
83 |
|
23 |
|
| SAFETY | ||||||||
| SAFETY | 48 |
|
91 |
|
39 |
|
55 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
85 |
|
81 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
61 |
|
61 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 9 (worse than 91% compared with investment alternatives), NIKE (Footwear, USA) shares have lower financial characteristics compared with similar stocks. Shares of NIKE are low in value (priced high) with a consolidated Value Rank of 15 (worse than 85% of alternatives) and show below-average growth (Growth Rank of 23) but are safely financed (Safety Rank of 55), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 9, is a sell recommendation based on NIKE's financial characteristics. As the company NIKE's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 15) and low growth (Obermatt Growth Rank of 23), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 55) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 4 |
|
11 |
|
7 |
|
15 |
|
| GROWTH | ||||||||
| GROWTH | 21 |
|
41 |
|
83 |
|
23 |
|
| SAFETY | ||||||||
| SAFETY | 48 |
|
91 |
|
39 |
|
55 |
|
| COMBINED | ||||||||
| COMBINED | 24 |
|
39 |
|
39 |
|
9 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 15 (worse than 85% compared with alternatives), NIKE shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for NIKE. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 79% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 13 which means that the stock price compared with what market professionals expect for future profits is higher than 87% of comparable companies, indicating a low value concerning NIKE's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 17 which means that the stock price compared with what market professionals expect for future profit levels is higher than 83% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 12 is also low. Compared with invested capital, the stock price is higher than for 88% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 15, is a sell recommendation based on NIKE's stock price compared with the company's operational size and dividend yields. Should dividend investors pick NIKE? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose NIKE only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 1 |
|
9 |
|
9 |
|
13 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 11 |
|
7 |
|
5 |
|
17 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 1 |
|
6 |
|
3 |
|
12 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 56 |
|
59 |
|
61 |
|
79 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 4 |
|
11 |
|
7 |
|
15 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 23 (better than 23% compared with alternatives), NIKE shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for NIKE. Only Capital Growth has a good rank of 54, which means that currently professionals expect the company to grow its invested capital more than 26% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 47 which means that currently professionals expect the company to grow less than 53% of its competitors. Profit Growth with a rank of 26 and Stock Returns with a rank of 9 are also low (below 91% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 23, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for NIKE is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 25 |
|
66 |
|
73 |
|
47 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 35 |
|
16 |
|
87 |
|
26 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
79 |
|
59 |
|
54 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 33 |
|
47 |
|
51 |
|
9 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 21 |
|
41 |
|
83 |
|
23 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 55 (better than 55% compared with alternatives), the company NIKE has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of NIKE is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for NIKE. Liquidity is at 81, meaning the company generates more profit to service its debt than 81% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 30, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 70% of its competitors. Leverage is also high at a rank of 36, which means that the company has an above-average debt-to-equity ratio. It has more debt than 64% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 55 (better than 55% compared with alternatives), NIKE has a financing structure that is safer than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 62 |
|
36 |
|
38 |
|
36 |
|
| REFINANCING | ||||||||
| REFINANCING | 13 |
|
98 |
|
18 |
|
30 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 86 |
|
84 |
|
65 |
|
81 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 48 |
|
91 |
|
39 |
|
55 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
52 |
|
57 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
98 |
|
79 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
31 |
|
69 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
68 |
|
78 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
85 |
|
81 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for NIKE from December 19, 2024.
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