Nike (NKE) Stock Sinks As Market Gains: What You Should Know
Nike (NKE) closed the most recent trading day at $125.33, moving -0.32% from the previous trading session. This change lagged the S&P 500's daily gain of 1.29%. At the same time, the Dow added 0.78%, and the tech-heavy Nasdaq lost 4.94%.
Prior to today's trading, shares of the athletic apparel maker had gained 0.7% over the past month. This has lagged the Consumer Discretionary sector's gain of 8.45% and the S&P 500's gain of 5.64% in that time.
Nike will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.51, down 41.38% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $11.37 billion, up 4.56% from the year-ago period.
NKE's full-year Zacks Consensus Estimates are calling for earnings of $3.11 per share and revenue of $49.98 billion. These results would represent year-over-year changes of -17.07% and +6.99%, respectively.
It is also important to note the recent changes to analyst estimates for Nike. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.22% higher. Nike is holding a Zacks Rank of #2 (Buy) right now.
Digging into valuation, Nike currently has a Forward P/E ratio of 40.44. Its industry sports an average Forward P/E of 15.07, so we one might conclude that Nike is trading at a premium comparatively.
We can also see that NKE currently has a PEG ratio of 4.22. 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. NKE's industry had an average PEG ratio of 4.22 as of yesterday's close.
The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 174, which puts it in the bottom 31% 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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