NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of A. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, growth in earnings per share and increase in net income. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
- ACTIVE STOCK TRADERS: Check out TheStreet's special offer for Real Money, headlined by Jim Cramer, now!
Highlights from the ratings report include:
- NKE's revenue growth has slightly outpaced the industry average of 11.0%. Since the same quarter one year prior, revenues rose by 15.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- NKE's debt-to-equity ratio is very low at 0.04 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, NKE has a quick ratio of 1.90, which demonstrates the ability of the company to cover short-term liquidity needs.
- The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- NIKE INC has improved earnings per share by 11.1% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NIKE INC increased its bottom line by earning $4.40 versus $3.87 in the prior year. This year, the market expects an improvement in earnings ($4.94 versus $4.40).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Textiles, Apparel & Luxury Goods industry average. The net income increased by 7.1% when compared to the same quarter one year prior, going from $523.00 million to $560.00 million.
NIKE, Inc., together with its subsidiaries, engages in the design, development, marketing, and sale of footwear, apparel, equipment, and accessory products for men, women, and children worldwide. The company has a P/E ratio of 20.6, equal to the average consumer non-durables industry P/E ratioand above the S&P 500 P/E ratio of 17.7. Nike has a market cap of $36.35 billion and is part of the
industry. Shares are up 3.1% year to date as of the close of trading on Friday.
You can view the full
or get investment ideas from our
--Written by a member of TheStreet Ratings Staff.
TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.