1 / 23

NIKE

NIKE. Presentation Outline. Snapshot Brief Overview Financial Statements Industry Comparison Current News Technical Analysis Trend Analysis Eval Summary of Valuations. Analysts Recommendations Risk Investment Recommendations. Snapshot. Brief Overview.

taylor
Download Presentation

NIKE

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. NIKE

  2. Presentation Outline • Snapshot • Brief Overview • Financial Statements • Industry Comparison • Current News • Technical Analysis • Trend Analysis • Eval • Summary of Valuations • Analysts Recommendations • Risk • Investment Recommendations

  3. Snapshot

  4. Brief Overview • NIKE’s principal business activity is the design, development and worldwide marketing of high quality footwear, apparel, equipment, and accessory product • The largest seller of athletic footwear and athletic apparel in the world • Distributed in over 160 countries around the world • Sell under the NIKE brand, wholly owned subsidiary Converse, Cole Haan, g Series, Bragano, Hurley, NIKE Hockey, and Exeter brands • Main competitors have joined with the recent announced acquisition of Reebok by Adidas

  5. Overview • Nike’s best year was last year. • The US accounts for 46% of revenues. • Market Cap doubled in 1 year, mostly due to the growth in US footwear sales. • Internet market share makes buying shoes easy. • No such thing as bad publicity.

  6. Financial Statements • Sales growth has consistently grown over the last four years • 4.3% in 02’ 8.1% in 03’ 14.5% in 04’ 12.1% in 05’ • Increase in Gross Margin from 39%-45%, however this is not likely to continue to grow in future years • Red Flags…

  7. Industry Comparison

  8. Current News • England just banned the use of a chemical that is used in the production of leather shoes. The affects on NIKE have yet to be determined. • Adidas announce its acquisition of Reebok. These are the two biggest competitors, who when combined, will be roughly the size of NIKE.

  9. Technical Analysis In the last Year… • Support level 76 dollars per share • Resistance level approximately 92 dollars a share • Last 5 years… • Support level at 39 dollars a share

  10. Technical Analysis Continued… • In line with its 200 day moving average • Has tended to less volatility over the last 2-3 years

  11. Trend Analysis

  12. Inventory Trends

  13. Leverage Analysis

  14. Operating Cash Flow

  15. Revenue Breakdown

  16. EVal

  17. Summary of Valuations

  18. Analysts Recommendations • Analysts have a price target between 95-110 dollars depending on one or two year return • Consensus recommendation is OUTPERFORM • Mean rating is a 1.84, down from a 2.06 two months ago

  19. NIKE Risk • Risk Grade – 103 (Max 134) • Over 3/4 of all stocks available are more risky than NIKE

  20. Risk Cont’d

  21. Portfolio with NIKE • Risk Grade of 60 vs. current risk grade of 62 • An analysis of our current portfolio labels consumer discretionary as the most underweight sector compared to the benchmark • Interesting Facts: • Nike NEVER made an offer to buy Under Armor • They had Nike Shocks well before they were sold in store but decided to hold sale until Michael Jordon retired and his shoe line lost popularity

  22. Investment Recommendations • Positive: Company has strong potential if it can tap into the foreign markets (China and International Soccer). A purchase of 65 shares would account for 4.65% of the portfolio and would have a market value 5,382 dollars. • Negative: • Right now too much stress is put on the strength and growth of the US Footwear sector. • The abroad sector that is expected to grow contributes a low percentage of overall revenue. However, this does leave room for rapid growth and expansion. • The company has doubled its market cap. over the last five years and has seen a very wide trading range between 50 and 90 dollars.

More Related