Nike, Inc. (NYSE:NKE) – If you had invested $1,000 in Nike stock when the Air Jordan shoes were released, here’s how much you would have now

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Nike Inc. (NYSE: NKE) is one of the most recognizable brands in the world. The company completed an IPO in 1980 and has been listed on the stock exchange ever since.

Here’s how a key event in 1985 has influenced the stock price’s rise over the past 36 years.

What happened: From 1972 to 1984, Nike sales grew from $3 million to $919 million. The company enjoyed great success as customers flocked to the company’s footwear and apparel.

Trends changed in 1984 and the company experienced its first drop in profits. Profits fell 29% in fiscal 1984. Two quarters in 1985 saw the company post its first losses.

Nike has signed Michael Jordanwho had just won an NCAA championship at the University of North Carolina, to an endorsement deal that included a shoe bearing his name.

On April 1, 1985, Nike launched Air Jordan shoes in six cities. The shoes quickly became a bestseller for the shoe company.

Jordan wore the shoes in NBA games, despite getting a fine by the league for violating a uniform and shoe color policy. Nike happily paid the fine.

Marketing of Jordan wearing the shoes and ads included the famous “who said man wasn’t supposed to fly” ad featuring Jordan hovering over the rim helped push the demand for shoes.

Over $55 million worth of Air Jordans had sold in mid-June 1995. Some people were buying the wrong shoe size just to say they had it in their collection.

Today, Air Jordan has sponsorship deals with universities, football teams and individual NBA athletes, including Luka Doncic, Zion Williamson and Russell Westbrook.

Related Link: Nike Sees Long Growth with Focus on Direct Sales and Margin Growth: Analysts Respond to Q4

Investing in Nike: The struggle over Nike’s finances could have created a buying opportunity for investors if they believed the Air Jordans would succeed.

Nike stock traded at a high split-adjusted price of 14 cents per share on April 1, 1985. A $1,000 investment in Nike stock could have purchased 7,142.86 shares of NKE.

These shares would be worth $1,142,143.31 today based on Nike’s stock price of $159.90 at the time of writing.

A $1,000 investment in Nike stock has turned into a million dollar investment over the past 36 years.

Photo: Paul Volkmer to Unsplash

© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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