NIKE Reports Q4 Earnings: GAAP EPS Beats Estimates, Revenue Falls Short

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Nike ($NYSE:NKE) Inc. reported their fourth quarter earnings for the fiscal year on Thursday, and the results showed a mixed picture. The company reported an earning per share (EPS) of $1.03 as per Generally Accepted Accounting Principles (GAAP) which exceeded expectations by $0.18, however, the revenue of $13.39 billion fell short by $40 million. Nike is an American multinational company that designs, develops, and manufactures sportswear, footwear, apparel, accessories, and equipment. It is one of the world’s leading suppliers of athletic shoes and apparel and owns and operates retail stores worldwide.

On the stock market, Nike is listed on the New York Stock Exchange and is part of the Dow Jones Industrial Average. Overall, Nike reported earnings that beat expectations but revenues were lower than expected due to the pandemic. Despite these short-term challenges, the company continues to focus on long-term growth strategies to drive future success.

Earnings

Compared to previous year’s figures, total revenue had decreased by 3.5% while net income increased by 27.2%. In the last 3 years, total revenue had risen from 12.25B USD to 12.94B USD. However, its GAAP earnings per share (EPS) beat estimates.

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Nike. NIKE_Reports_Q4_Earnings_GAAP_EPS_Beats_Estimates_Revenue_Falls_Short”>More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Nike. NIKE_Reports_Q4_Earnings_GAAP_EPS_Beats_Estimates_Revenue_Falls_Short”>More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Nike. NIKE_Reports_Q4_Earnings_GAAP_EPS_Beats_Estimates_Revenue_Falls_Short”>More…

Key Ratios Snapshot

Some of the financial key ratios for Nike are shown below. NIKE_Reports_Q4_Earnings_GAAP_EPS_Beats_Estimates_Revenue_Falls_Short”>More…

Market Price

On Thursday, NIKE reported its fourth quarter earnings, which beat analysts’ expectations on a GAAP basis, although it fell short of expectations on revenue. Despite this, investors responded positively to the news as the stock opened at $122.3 and closed at $122.5, up by 0.9% from its previous closing price of 121.4. This could be attributed to strong pandemic-driven consumer demand for NIKE’s digital offerings.

The company also reported that its global market share in footwear had increased by 1% from the same period last year. As a result, investors responded positively to the news and drove up its stock price. Live Quote…

Analysis

As a part of GoodWhale’s analysis of NIKE‘s wellbeing, we classified the company as a ‘Gorilla’ based on the Star Chart. This type of company is known to have achieved stable and high revenue or earning growth due to its strong competitive advantage. Considering this, investors who are looking for robust and consistent returns are likely to be interested in NIKE. The health score for NIKE is 10/10, indicating that the company has a strong financial position which allows it to sustain operations in times of crisis. We also found that NIKE is strong in terms of asset, dividend, and profitability as well as being medium in terms of growth. All of these factors make NIKE an attractive investment option for investors. More…

Peers

Nike Inc is one of the world’s leading sports and fitness companies. Founded in 1964, Nike designs, develops, and markets a wide range of footwear, apparel, equipment, and accessories for a variety of sports and fitness activities. Nike’s main competitors in the global athletic footwear market are Metro Brands Ltd, Campus Activewear Ltd, and Wolverine World Wide Inc. All three companies are based in the United States and have a significant presence in the global market for athletic footwear.

– Metro Brands Ltd ($BSE:543426)

Macau-based Melco Resorts & Entertainment Ltd is a developer, owner and operator of casino gaming and entertainment resort facilities in Asia. The company’s market cap is $24.3 billion and its ROE is 24.1%. Melco Resorts & Entertainment’s mission is to create extraordinary experiences for its guests, investors, employees and business partners. The company’s resorts offer a wide range of gaming, entertainment, dining and shopping options. In addition to its flagship properties in Macau, the company also owns and operates resorts in the Philippines, Cyprus and Malta.

– Campus Activewear Ltd ($BSE:543523)

Campus Activewear Ltd is a leading retailer of sporting goods and apparel in the United States. The company has a market cap of 192.59B as of 2022 and a return on equity of 35.63%. Campus Activewear is headquartered in Boston, Massachusetts and operates stores in all 50 states. The company sells a wide variety of products, including athletic apparel, footwear, and equipment for a variety of sports.

– Wolverine World Wide Inc ($NYSE:WWW)

Wolverine World Wide, Inc. is a global lifestyle brand that designs, manufactures and markets a range of footwear, apparel and accessories for men, women and children. The Company’s products are available in more than 190 countries and territories through a network of subsidiaries, licensees and distributors. The Company operates in four segments: Wolverine Outdoor & Lifestyle Group, Wolverine Boston Group, Wolverine Heritage Group and Wolverine Worldwide Direct-to-Consumer. The Company’s brands include Merrell, Sperry, Hush Puppies, Saucony, Wolverine, Keds, Stride Rite, Sebago, Chaco, Bates, HyTest and Cushe.

Summary

Despite the revenue miss, investors will likely have taken comfort in the strong EPS beat. Analysts have expressed optimism for Nike‘s future prospects, noting the company’s strong position within the sportswear market and its ability to capitalise on digital opportunities such as e-commerce and online sales. Investors should monitor Nike’s performance as it continues to face challenges posed by competition and shifting consumer trends.