This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Nike's Long-Term Goals Are Better Than Anything Kicked in the World Cup

Stocks in this article: AAPL NKE ADDYY UA

NEW YORK (TheStreet) -- World Cup fever seems to be everywhere.

The recent gains in Nike (NKE) stock (up 6.5% since May) have been attributed to the popularity of soccer ... excuse me, futbol. This suggests that once the final goal is made investors should pack up their tents and kick Nike to the curb. This doesn't make sense.

The stock closed Tuesday at $78, flat on the year to date but down from the 2014 high of $80.09 reached in March. Investors are still missing the big picture.

>>How the World Cup Has Helped Twitter

Management has telegraphed exactly why the stock remains a strong buy. Nervermind that Nike is an overly safe long-term play, the company now expects to return to growth. Investors looking for an iconic brand that also pays a strong 1.3% yield better jump in now.

Nike has been and always will remain a strong global brand. Although competition has heightened from Adidas (ADDYY) and Under Armour (UA), Nike management has outlined long-term growth strategies to suggest it plans to maintain its market share and seize share from the competition by growing in key areas.

Never shying away from pressure, management projects to grow fiscal 2015 revenue to $30 billion. The company also expects to grow revenue at an annual rate of 10% over the next two years, culminating in revenue of $36 billion for 2017.

In the process, Nike expects to produce earnings per share in the mid-teens. There is nothing conservative about these targets, especially when considering that Nike produced a modest 5% increase in earnings in the most recent quarter.

How do you suppose the company will reach these goals? There are several options but in my opinion only two will matter -- and Nike has expertise in both.

First, very few companies, even those in the realm of technology, can match Nike's innovative qualities. The company has spent the past couple of years figuring out ways to widen its lead over its rivals.

Nike has invested resources, working with manufacturers to produce high-performance materials to come up with products like knitwear shoes and its popular FuelBand, which (according to some) inspired the much-rumored iWatch that is due out this fall by Apple (AAPL).

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs