Should you buy Nike stock at $122?

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[Note: Nike fiscal year ends in May]

Nike shares (NYSE: NKE), a company that designs, develops and markets footwear, apparel, equipment and accessories, is up 6% in the past twenty-one trading days (one month) and currently sits at around $122. It should be noted that the entire S&P500 has seen marginal growth over the past month. With its recent Q3 2022 earnings report, the company demonstrated its ability to grow despite the deteriorating supply chain situation and lockdowns in China. It is worth mentioning that Greater China accounts for almost 20% of the company’s revenue and generates around 45% of operating profit. In the recent third quarter, Nike’s sales in China fell 8% year-on-year, but the company still managed to post a 5% year-on-year increase in revenue to $10.9 billion. dollars. However, its net income fell 4% year-on-year to 87 cents per share.

Over the past three quarters, Nike’s revenue rose 7% year-on-year to $34.5 billion, while profitability rose 9% year-on-year to $2.91 per share. The company has been focused on protecting its margins which rose 190 basis points to 46.3% in the first nine months of 2022. This is largely due to Nike increasing its revenue to a rate higher than its cost of sales.

While the company’s stock price is currently negatively impacted by supply chain issues, inflation and the Russian invasion of Ukraine, we believe these issues are short-term and will end. by resolving in the longer term. Now, is NKE stock set to decline in the near term or does gains seem more likely? Based on our machine learning analysis of share price trends over the past ten years, there is a 67% chance of a rise in NKE stock over the next month (twenty-one days scholarship). See our analysis on NKE Stock up chance for more details.

Calculation of “probability of occurrence” and “probability of increase” using data from the last ten years

[1] Returns of 2.4% or more in five– daytime 698 times out of 2516 (28%); Stock rose over the next five days in 371 of those 698 cases (53%)

[2] Returns of 12% or more on a ten day period 33 times out of 2515 (1%); The stock rose over the next ten days in 19 of those 33 cases (58%)

[3] Returns of 6.3% or more on a 21 day period 612 times out of 2515 (24%); Stock rose over the next twenty-one days in 407 of those 612 cases (67%)

It helps to see how your peers compare. NKE Peers shows how Nike’s stock compares to its peers on important metrics. You’ll find other useful comparisons for companies in all industries at Peer Comparisons.

What if you were looking for a more balanced portfolio instead? Our quality portfolio and multi-strategy portfolio have consistently beaten the market since late 2016.

Return June 2022
MTD [1]
2022
YTD [1]
2017-22
Total [2]
Back NKE 2% -27% 139%
S&P 500 return 1% -13% 86%
Trefis Multi-Strategy Portfolio 3% -17% 227%

[1] Cumulative monthly and cumulative annual as of 06/08/2022
[2] Cumulative total returns since the end of 2016

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