In the latest trading session, Nike (NKE) closed at $95.51, marking a -0.78% move from the previous day. This change lagged the S&P 500's 0.07% gain on the day. At the same time, the Dow added 0.02%, and the tech-heavy Nasdaq gained 0.01%.
Prior to today's trading, shares of the athletic apparel maker had lost 8.16% over the past month. This has lagged the Consumer Discretionary sector's loss of 3.73% and the S&P 500's gain of 0.38% in that time.
Nike will be looking to display strength as it nears its next earnings release, which is expected to be September 28, 2023. The company is expected to report EPS of $0.73, down 21.51% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $12.98 billion, up 2.29% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.71 per share and revenue of $53.64 billion. These totals would mark changes of +14.86% and +5.95%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for Nike. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.22% lower within the past month. Nike currently has a Zacks Rank of #4 (Sell).
Digging into valuation, Nike currently has a Forward P/E ratio of 25.94. Its industry sports an average Forward P/E of 12.74, so we one might conclude that Nike is trading at a premium comparatively.
Meanwhile, NKE's PEG ratio is currently 1.7. 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 1.1 as of yesterday's close.
The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 234, putting it in the bottom 8% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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