Nike (NKE) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
T-Mobile (TMUS) closed the most recent trading day at $74.90, moving +0.6% from the previous trading session.

Nike (NKE) closed at $76.04 in the latest trading session, marking a -0.5% move from the prior day. This move lagged the S&P 500's daily loss of 0.02%. Elsewhere, the Dow lost 0.03%, while the tech-heavy Nasdaq lost 0.21%.

Heading into today, shares of the athletic apparel maker had gained 4.79% over the past month, outpacing the Consumer Discretionary sector's gain of 0.77% and the S&P 500's loss of 1.4% in that time.

Investors will be hoping for strength from NKE as it approaches its next earnings release, which is expected to be March 28, 2019. In that report, analysts expect NKE to post earnings of $0.63 per share. This would mark a year-over-year decline of 7.35%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $9.49 billion, up 5.68% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.62 per share and revenue of $39.11 billion. These totals would mark changes of +8.26% and +7.44%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for NKE. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.15% lower. NKE is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note NKE's current valuation metrics, including its Forward P/E ratio of 29.13. This valuation marks a premium compared to its industry's average Forward P/E of 13.88.

Meanwhile, NKE's PEG ratio is currently 2.37. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Shoes and Retail Apparel was holding an average PEG ratio of 1.43 at yesterday's closing price.

The Shoes and Retail Apparel industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 198, putting it in the bottom 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on click here.