Add a New Bulls Reason

Company: Nike (NKE)
Current price:
Headline: (100 character max)
Analysis:
Cancel
96%
agree
59 votes

  Nike commands the footwear market

Nike is the largest producer of athletic footwear and apparel, and it essentially commands the footwear market. That kind of dominance is very appealing.

(100 character max) Cancel
100%
agree
8 votes

  Strong balance sheet puts Nike on track to acquire other struggling companies

As of November 30, 2008, Nike had more than $1.7 billion in cash on its balance sheet, compared to just $445.5 million in long-term debt. Nike's strong balance sheet and ability to weather the recession puts it in a great position to buy other companies at bargain prices. The company is reportedly in discussion to buy Quiksilver, Inc., a sportswear company geared mainly towards surfing and skateboarding. Quiksilver’s stock price rose 46 percent on Monday, January 26 to $2.21 per share, on speculation that the company could sell itself or its brands.

In 2002, Nike purchased the popular surfwear company Hurley International in a deal reported to be worth between $100 million and $140 million. The recession could open new opportunites for Nike to push into surfing, a market outside of its traditional core categoreis of soccer, basketball, running, men’s training, women’s fitness and sports culture.

(100 character max) Cancel
100%
agree
3 votes

  Efforts to open retail locations

The recent effort to open more retail locations, in conjunction with Nike's new emphasis on low-performance apparel, may add to Nike's bottom line.

(100 character max) Cancel
100%
agree
2 votes

  Wide brand recognition and aggressive marketing

Nike exploits its scale with wide brand recognition and aggressive marketing, showing a commitment to maintaining its bottom line.

(100 character max) Cancel
0%
agree
0 votes

  Nike's Movement into Low-Performance Footwear

Nike has diversified its footwear into the rapidly expanding action sports/low-performance footwear market with the acquisition of Converse and Hurley International. These products become increasingly more popular in times of economic downturns, when customers begin to shy away from Nike's high performance shoes that average $100/pair and begin buying more low-performance shoes (average $65/pair)

(100 character max) Cancel
0%
agree
0 votes

  International Expansion Promotes Growth

Nike's international expansion, primarily into developing countries like China, Russia, and Brazil, help promote the company's growth in sales as its domestic sales slow.

(100 character max) Cancel
0%
agree
1 votes

  Nike sticking by Tiger Woods

In light of the Tiger Woods marital scandal, many of his main sponsors have either cut ties with him completely (such as Accenture) or cut back on using him in their advertisements (such as Gilette). Nike, however, has firmly stuck by their man, and many believe this will have no harm on Nike's business.

In its Q2 2010 report, the company announced that its shares rose by 1.9% after the reported figures were better than expected. The company expects future growth due to an increase in future orders, and believes this will more than offset any harm resulting from the Tiger Woods incident because its golf business only makes up 3% of its sales.

(100 character max) Cancel
Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki