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

Zacks Equity Research

In the latest trading session, Nike (NKE) closed at $90.92, marking a -0.63% move from the previous day. This move lagged the S&P 500's daily gain of 0.41%. Elsewhere, the Dow gained 0.57%, while the tech-heavy Nasdaq added 0.7%.

Heading into today, shares of the athletic apparel maker had lost 0.73% over the past month, lagging the Consumer Discretionary sector's gain of 0.77% and the S&P 500's gain of 2.04% in that time.

Wall Street will be looking for positivity from NKE as it approaches its next earnings report date. On that day, NKE is projected to report earnings of $0.58 per share, which would represent year-over-year growth of 11.54%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $10.08 billion, up 7.52% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.97 per share and revenue of $42.24 billion, which would represent changes of +19.28% and +7.98%, respectively, from the prior year.

Any recent changes to analyst estimates for NKE should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.9% higher. NKE is currently a Zacks Rank #2 (Buy).

Valuation is also important, so investors should note that NKE has a Forward P/E ratio of 30.79 right now. This represents a premium compared to its industry's average Forward P/E of 15.95.

Investors should also note that NKE has a PEG ratio of 2.36 right now. 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 industry currently had an average PEG ratio of 1.67 as of yesterday's close.

The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 30, which puts it in the top 12% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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