U.S. Markets closed

Nike (NKE) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

Nike (NKE) closed at $86.75 in the latest trading session, marking a -0.09% move from the prior day. This move lagged the S&P 500's daily gain of 0.72%. Meanwhile, the Dow gained 0.85%, and the Nasdaq, a tech-heavy index, added 1.06%.

Coming into today, shares of the athletic apparel maker had gained 4.21% in the past month. In that same time, the Consumer Discretionary sector gained 2.9%, while the S&P 500 gained 2.25%.

Investors will be hoping for strength from NKE as it approaches its next earnings release, which is expected to be September 24, 2019. In that report, analysts expect NKE to post earnings of $0.71 per share. This would mark year-over-year growth of 5.97%. Meanwhile, our latest consensus estimate is calling for revenue of $10.45 billion, up 5.04% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.90 per share and revenue of $42.21 billion. These totals would mark changes of +16.47% and +7.91%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for NKE. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.16% lower. NKE currently has a Zacks Rank of #3 (Hold).

In terms of valuation, NKE is currently trading at a Forward P/E ratio of 29.95. This valuation marks a premium compared to its industry's average Forward P/E of 15.26.

We can also see that NKE currently has a PEG ratio of 2.3. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Shoes and Retail Apparel was holding an average PEG ratio of 1.44 at yesterday's closing price.

The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 61, which puts it in the top 24% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
NIKE, Inc. (NKE) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research