NIKE INC -CL B (NKE) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NKE - US6541061031 - Common Stock
63.71 USD
+2.52 (+4.12%)
64.02 USD
+0.31 (+0.49%)
We assign a fundamental rating of 6 out of 10 to NKE. NKE was compared to 45 industry peers in the Textiles, Apparel & Luxury Goods industry. Both the health and profitability get an excellent rating, making NKE a very profitable company, without any liquidiy or solvency issues. NKE is valied quite expensively at the moment, while it does show a decent growth rate. Finally NKE also has an excellent dividend rating. These ratings could make NKE a good candidate for dividend investing.
1. Profitability
1.1 Basic Checks
In the past year NKE was profitable.
NKE had a positive operating cash flow in the past year.
NKE had positive earnings in each of the past 5 years.
Each year in the past 5 years NKE had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 7.75%, NKE belongs to the best of the industry, outperforming 86.67% of the companies in the same industry.
With a decent Return On Equity value of 21.50%, NKE is doing good in the industry, outperforming 80.00% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 10.87%, NKE is in the better half of the industry, outperforming 73.33% of the companies in the same industry.
NKE had an Average Return On Invested Capital over the past 3 years of 16.64%. This is significantly above the industry average of 11.62%.
The 3 year average ROIC (16.64%) for NKE is well above the current ROIC(10.87%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.75% | ||
| ROE | 21.5% | ||
| ROIC | 10.87% |
ROA(3y)12.42%
ROA(5y)13.49%
ROE(3y)33.36%
ROE(5y)36.9%
ROIC(3y)16.64%
ROIC(5y)18.07%
1.3 Margins
The Profit Margin of NKE (6.23%) is better than 82.22% of its industry peers.
NKE's Profit Margin has been stable in the last couple of years.
With a decent Operating Margin value of 7.36%, NKE is doing good in the industry, outperforming 62.22% of the companies in the same industry.
NKE's Operating Margin has been stable in the last couple of years.
NKE has a worse Gross Margin (41.94%) than 62.22% of its industry peers.
In the last couple of years the Gross Margin of NKE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.36% | ||
| PM (TTM) | 6.23% | ||
| GM | 41.94% |
OM growth 3Y-17.6%
OM growth 5Y-0.82%
PM growth 3Y-18.72%
PM growth 5Y0.48%
GM growth 3Y-2.41%
GM growth 5Y-0.32%
2. Health
2.1 Basic Checks
NKE has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for NKE has been reduced compared to 1 year ago.
The number of shares outstanding for NKE has been reduced compared to 5 years ago.
The debt/assets ratio for NKE has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.31 indicates that NKE is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.31, NKE is in the better half of the industry, outperforming 77.78% of the companies in the same industry.
The Debt to FCF ratio of NKE is 2.66, which is a good value as it means it would take NKE, 2.66 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of NKE (2.66) is better than 68.89% of its industry peers.
NKE has a Debt/Equity ratio of 0.59. This is a neutral value indicating NKE is somewhat dependend on debt financing.
NKE's Debt to Equity ratio of 0.59 is on the low side compared to the rest of the industry. NKE is outperformed by 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 2.66 | ||
| Altman-Z | 4.31 |
ROIC/WACC0.97
WACC11.26%
2.3 Liquidity
A Current Ratio of 2.19 indicates that NKE has no problem at all paying its short term obligations.
NKE has a Current ratio of 2.19. This is in the better half of the industry: NKE outperforms 62.22% of its industry peers.
NKE has a Quick Ratio of 1.45. This is a normal value and indicates that NKE is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of NKE (1.45) is better than 73.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.19 | ||
| Quick Ratio | 1.45 |
3. Growth
3.1 Past
NKE shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -47.85%.
Measured over the past 5 years, NKE shows a small growth in Earnings Per Share. The EPS has been growing by 3.37% on average per year.
The Revenue has decreased by -5.03% in the past year.
NKE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.36% yearly.
EPS 1Y (TTM)-47.85%
EPS 3Y-16.87%
EPS 5Y3.37%
EPS Q2Q%-32.05%
Revenue 1Y (TTM)-5.03%
Revenue growth 3Y-0.29%
Revenue growth 5Y4.36%
Sales Q2Q%0.59%
3.2 Future
The Earnings Per Share is expected to grow by 16.96% on average over the next years. This is quite good.
Based on estimates for the next years, NKE will show a small growth in Revenue. The Revenue will grow by 4.85% on average per year.
EPS Next Y-24.92%
EPS Next 2Y6.25%
EPS Next 3Y11.18%
EPS Next 5Y16.96%
Revenue Next Year1.76%
Revenue Next 2Y3.17%
Revenue Next 3Y3.75%
Revenue Next 5Y4.85%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 37.48, the valuation of NKE can be described as expensive.
NKE's Price/Earnings ratio is in line with the industry average.
NKE is valuated rather expensively when we compare the Price/Earnings ratio to 26.51, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 26.13 indicates a quite expensive valuation of NKE.
Compared to the rest of the industry, the Price/Forward Earnings ratio of NKE indicates a slightly more expensive valuation: NKE is more expensive than 66.67% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of NKE to the average of the S&P500 Index (23.13), we can say NKE is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.48 | ||
| Fwd PE | 26.13 |
4.2 Price Multiples
NKE's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. NKE is more expensive than 71.11% of the companies in the same industry.
NKE's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.3 | ||
| EV/EBITDA | 21.93 |
4.3 Compensation for Growth
NKE has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)11.12
EPS Next 2Y6.25%
EPS Next 3Y11.18%
5. Dividend
5.1 Amount
NKE has a Yearly Dividend Yield of 2.73%.
NKE's Dividend Yield is rather good when compared to the industry average which is at 1.52. NKE pays more dividend than 84.44% of the companies in the same industry.
NKE's Dividend Yield is a higher than the S&P500 average which is at 2.00.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.73% |
5.2 History
On average, the dividend of NKE grows each year by 10.70%, which is quite nice.
NKE has been paying a dividend for at least 10 years, so it has a reliable track record.
NKE has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.7%
Div Incr Years23
Div Non Decr Years34
5.3 Sustainability
80.59% of the earnings are spent on dividend by NKE. This is not a sustainable payout ratio.
The dividend of NKE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP80.59%
EPS Next 2Y6.25%
EPS Next 3Y11.18%
63.71
+2.52 (+4.12%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryTextiles, Apparel & Luxury Goods
Earnings (Last)
Earnings (Next)
Inst Owners83.24%
Inst Owner Change-2.18%
Ins Owners0.66%
Ins Owner Change4.23%
Market Cap94.18B
Revenue(TTM)46.51B
Net Income(TTM)2.90B
Analysts75.45
Price Target80.28 (26.01%)
Short Float %3.15%
Short Ratio2.13
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.73% |
Yearly Dividend1.54
Dividend Growth(5Y)10.7%
DP80.59%
Div Incr Years23
Div Non Decr Years34
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)42.76%
Min EPS beat(2)7.49%
Max EPS beat(2)78.04%
EPS beat(4)4
Avg EPS beat(4)47.74%
Min EPS beat(4)7.49%
Max EPS beat(4)83.55%
EPS beat(8)8
Avg EPS beat(8)33.55%
EPS beat(12)11
Avg EPS beat(12)30.36%
EPS beat(16)15
Avg EPS beat(16)26.66%
Revenue beat(2)2
Avg Revenue beat(2)3.98%
Min Revenue beat(2)2.46%
Max Revenue beat(2)5.51%
Revenue beat(4)4
Avg Revenue beat(4)2.55%
Min Revenue beat(4)0.86%
Max Revenue beat(4)5.51%
Revenue beat(8)5
Avg Revenue beat(8)0.61%
Revenue beat(12)8
Avg Revenue beat(12)1.35%
Revenue beat(16)11
Avg Revenue beat(16)1.28%
PT rev (1m)-5.65%
PT rev (3m)-0.76%
EPS NQ rev (1m)2.62%
EPS NQ rev (3m)-23.9%
EPS NY rev (1m)-3.43%
EPS NY rev (3m)-3.35%
Revenue NQ rev (1m)0.15%
Revenue NQ rev (3m)2.03%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)1.89%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.48 | ||
| Fwd PE | 26.13 | ||
| P/S | 2.03 | ||
| P/FCF | 31.3 | ||
| P/OCF | 26.71 | ||
| P/B | 6.99 | ||
| P/tB | 7.26 | ||
| EV/EBITDA | 21.93 |
EPS(TTM)1.7
EY2.67%
EPS(NY)2.44
Fwd EY3.83%
FCF(TTM)2.04
FCFY3.2%
OCF(TTM)2.39
OCFY3.74%
SpS31.42
BVpS9.11
TBVpS8.77
PEG (NY)N/A
PEG (5Y)11.12
Graham Number18.67
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.75% | ||
| ROE | 21.5% | ||
| ROCE | 12.94% | ||
| ROIC | 10.87% | ||
| ROICexc | 16.09% | ||
| ROICexgc | 16.55% | ||
| OM | 7.36% | ||
| PM (TTM) | 6.23% | ||
| GM | 41.94% | ||
| FCFM | 6.48% |
ROA(3y)12.42%
ROA(5y)13.49%
ROE(3y)33.36%
ROE(5y)36.9%
ROIC(3y)16.64%
ROIC(5y)18.07%
ROICexc(3y)27.29%
ROICexc(5y)31.4%
ROICexgc(3y)28.17%
ROICexgc(5y)32.46%
ROCE(3y)19.82%
ROCE(5y)21.52%
ROICexgc growth 3Y-18.4%
ROICexgc growth 5Y0.36%
ROICexc growth 3Y-18.27%
ROICexc growth 5Y0.46%
OM growth 3Y-17.6%
OM growth 5Y-0.82%
PM growth 3Y-18.72%
PM growth 5Y0.48%
GM growth 3Y-2.41%
GM growth 5Y-0.32%
F-Score4
Asset Turnover1.24
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 2.66 | ||
| Debt/EBITDA | 1.91 | ||
| Cap/Depr | 66.54% | ||
| Cap/Sales | 1.11% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 84.01% | ||
| Profit Quality | 103.94% | ||
| Current Ratio | 2.19 | ||
| Quick Ratio | 1.45 | ||
| Altman-Z | 4.31 |
F-Score4
WACC11.26%
ROIC/WACC0.97
Cap/Depr(3y)88.17%
Cap/Depr(5y)88.39%
Cap/Sales(3y)1.47%
Cap/Sales(5y)1.52%
Profit Quality(3y)104.57%
Profit Quality(5y)98.22%
High Growth Momentum
Growth
EPS 1Y (TTM)-47.85%
EPS 3Y-16.87%
EPS 5Y3.37%
EPS Q2Q%-32.05%
EPS Next Y-24.92%
EPS Next 2Y6.25%
EPS Next 3Y11.18%
EPS Next 5Y16.96%
Revenue 1Y (TTM)-5.03%
Revenue growth 3Y-0.29%
Revenue growth 5Y4.36%
Sales Q2Q%0.59%
Revenue Next Year1.76%
Revenue Next 2Y3.17%
Revenue Next 3Y3.75%
Revenue Next 5Y4.85%
EBIT growth 1Y-45.67%
EBIT growth 3Y-17.84%
EBIT growth 5Y3.51%
EBIT Next Year1.76%
EBIT Next 3Y17.24%
EBIT Next 5Y19.88%
FCF growth 1Y-32.53%
FCF growth 3Y-9.64%
FCF growth 5Y18.49%
OCF growth 1Y-34.92%
OCF growth 3Y-10.67%
OCF growth 5Y8.27%
NIKE INC -CL B / NKE FAQ
What is the fundamental rating for NKE stock?
ChartMill assigns a fundamental rating of 6 / 10 to NKE.
Can you provide the valuation status for NIKE INC -CL B?
ChartMill assigns a valuation rating of 2 / 10 to NIKE INC -CL B (NKE). This can be considered as Overvalued.
How profitable is NIKE INC -CL B (NKE) stock?
NIKE INC -CL B (NKE) has a profitability rating of 7 / 10.
What is the expected EPS growth for NIKE INC -CL B (NKE) stock?
The Earnings per Share (EPS) of NIKE INC -CL B (NKE) is expected to decline by -24.92% in the next year.
How sustainable is the dividend of NIKE INC -CL B (NKE) stock?
The dividend rating of NIKE INC -CL B (NKE) is 7 / 10 and the dividend payout ratio is 80.59%.