4. Nike (NKE) sells sports equipment and apparel.
Quarter: Fiscal third-quarter profit more than doubled to $496 million, or $1.01, as revenue grew 6.6% to $4.7 billion. The operating margin extended from 13% to 14%. Nike has $4 billion of cash, equaling a quick ratio of 2.4, and $568 million of debt.
Stock: Nike has returned 32% during the past 12 months, outpacing U.S. indices. It trades at a price-to-projected-earnings ratio of 17 and a price-to-book ratio of 3.8, on par with peers. Its PEG ratio of 0.8 signals a 20% discount to estimated fair value.
Consensus: Of analysts covering Nike, 14, or 64%, advise purchasing its shares and eight recommend holding them. D.A. Davidson values Nike at $94, leaving 26% of potential upside. Robert W. Baird forecasts that the stock will gain 23% to $92.
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