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 20 (worse than 80% 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 21) but are safely financed (Safety Rank of 72), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 20, 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 21), 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 72) 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 |
14-Nov-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.
It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.
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 |
|
21 |
|
| SAFETY | ||||||||
| SAFETY | 48 |
|
91 |
|
39 |
|
72 |
|
| 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 20 (worse than 80% 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 21) but are safely financed (Safety Rank of 72), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 20, 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 21), 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 72) 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 |
|
21 |
|
| SAFETY | ||||||||
| SAFETY | 48 |
|
91 |
|
39 |
|
72 |
|
| COMBINED | ||||||||
| COMBINED | 24 |
|
39 |
|
39 |
|
20 |
|
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 77% 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 11 which means that the stock price compared with what market professionals expect for future profits is higher than 89% 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 15 which means that the stock price compared with what market professionals expect for future profit levels is higher than 85% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 9 is also low. Compared with invested capital, the stock price is higher than for 91% 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 |
|
11 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 11 |
|
7 |
|
5 |
|
15 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 1 |
|
6 |
|
3 |
|
9 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 56 |
|
59 |
|
61 |
|
77 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 4 |
|
11 |
|
7 |
|
15 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 21 (better than 21% 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. While Sales Growth ranks at 56, professionals currently expect the company to grow more than 56% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 22, which means that, currently, professionals expect the company to grow its profits less than 78% of its competitors, and Capital Growth has a low rank of 40. Historic stock returns were also below average with a current Stock Returns rank of 11 which means that the stock returns have recently been below 89% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 21, is a sell recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. 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 isn't stellar here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 25 |
|
66 |
|
73 |
|
56 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 35 |
|
16 |
|
87 |
|
22 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
79 |
|
59 |
|
40 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 33 |
|
47 |
|
51 |
|
11 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 21 |
|
41 |
|
83 |
|
21 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 72 (better than 72% 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 39, 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 61% of its competitors. Leverage is also high at a rank of 38, which means that the company has an above-average debt-to-equity ratio. It has more debt than 62% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 72 (better than 72% 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 |
|
38 |
|
| REFINANCING | ||||||||
| REFINANCING | 13 |
|
98 |
|
18 |
|
39 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 86 |
|
84 |
|
65 |
|
81 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 48 |
|
91 |
|
39 |
|
72 |
|
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 November 14, 2024.
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