Nike (NKE) Stock Gains on Positive Analyst Note

NEW YORK (TheStreet) -- Shares of Nike  (NKE) are up 0.29% to $107.12 after Deutsche Bank raised its 2015 fourth quarter earnings estimates to $0.84 from $0.81.

Nike is expected to release its 2015 fourth quarter earnings results and fiscal year 2015 results on June 25.

Deutsche Bank reiterated full-year earnings estimates of $3.56 per share for 2015 and $3.96 per share in 2016.

Additionally, the firm maintained its "buy" rating with a price target of $115 on the stock.

"Nike remains one of the best gross margin stories in our group; importantly, Nike's business in China should show continued, underlying progress," Deutsche Bank analysts said.

Nike reported a 23% constant currency increase in futures orders for the March through July period, the strongest growth of all its regions, and the basket of Chinese retailers is seeing steady growth, Deutsche Bank noted.

Nike is a seller of athletic footwear and athletic apparel that is engaged in design, development, marketing and selling of athletic footwear, apparel, equipment, accessories and services.

Separately, TheStreet Ratings team rates NIKE INC as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:

"We rate NIKE INC (NKE) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 39.08% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, NKE should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • NIKE INC has improved earnings per share by 18.7% 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 $2.98 versus $2.70 in the prior year. This year, the market expects an improvement in earnings ($3.55 versus $2.98).
  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Textiles, Apparel & Luxury Goods industry average. The net income increased by 16.0% when compared to the same quarter one year prior, going from $682.00 million to $791.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.3%. Since the same quarter one year prior, revenues slightly increased by 7.0%. 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 0.10 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 1.59, which demonstrates the ability of the company to cover short-term liquidity needs.
  • You can view the full analysis from the report here: NKE Ratings Report

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