Is Nike Inc well-positioned for February economic uncertainties?

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NKE Stock  USD 125.73  0.41  0.33%   
Gabriel Shpitalnik
By Gabriel Shpitalnik
Macroaxis Story
Today's article will digest Nike. We will analyze why it could be a much better year for Nike shareholders. Is the firm valuation justified? Here I will cover 2023 perspective on the current valuation of Nike Inc to give you a better outlook on taking a possible position in this stock. What are Nike's target price odds to finish over the current price? Based on a normal probability distribution, the odds of Nike jumping above the current price in 90 days from now is roughly 2.49%. The Nike Inc probability density function shows the probability of Nike stock to fall within a particular range of prices over 90 days. Considering the 90-day investment horizon the stock has a beta coefficient of 1.4825. This indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Nike will likely underperform. Additionally, the company has an alpha of 0.2542, implying that it can generate a 0.25 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta).
Published over two weeks ago
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This firm has 8.92 B in debt with debt to equity (D/E) ratio of 0.8, which is OK given its current industry classification. Nike is UNDERVALUED at 162.17 per share with modest projections ahead.
We determine the current worth of Nike Inc using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Nike Inc based exclusively on its fundamental and basic technical indicators. By analyzing Nike's financials, quarterly and monthly indicators, and related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Nike's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Nike. We calculate exposure to Nike's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Nike's related companies.

Nike Inc Investment Alerts

Nike investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring Nike Inc performance across your portfolios.Please check all investment alerts for Nike

Nike Valuation Ratios as Compared to Competition

Our valuation model uses many indicators to compare Nike value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Nike competition to find correlations between indicators driving the intrinsic value of Nike.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Nike, but it might be worth checking our own buy vs. sell analysis

A Deeper Perspective On Nike

The company reported the last year's revenue of 46.71 B. Total Income to common stockholders was 6.05 B with profit before taxes, overhead, and interest of 21.48 B.

Margins Breakdown

Nike profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or Nike itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of Nike profit margins.
10.4
Profit Margin
16.47
Operating Margin
18.44
EBITDA Margin
Operating Margin16.47
EBITDA Margin18.44
Gross Margin53.81
Profit Margin10.4


Nike Revenue Per Employee is increasing over the last 8 years. Moreover, Nike Earnings Before Interest Taxes and Depreciation Amortization EBITDA is increasing over the last 8 years. The previous year's value of Nike Earnings Before Interest Taxes and Depreciation Amortization EBITDA was 5,614,413,765.

Momentum Analysis of Nike suggests possible reversal in February

Latest variance is at 7.15.
As of the 14th of January 2023, Nike secures the Downside Deviation of 1.81, mean deviation of 1.87, and Risk Adjusted Performance of 0.2742. In connection with fundamental indicators, the technical analysis model lets you check existing technical drivers of Nike Inc, as well as the relationship between them. Strictly speaking, you can use this information to find out if the firm will indeed mirror its model of past prices, or the prices will eventually revert. We were able to collect data for nineteen technical drivers for Nike, which can be compared to its peers in the industry. Please verify Nike Inc jensen alpha, as well as the relationship between the potential upside and skewness to decide if Nike Inc is priced some-what accurately, providing market reflects its recent price of 128.85 per share. Given that Nike Inc has jensen alpha of 0.2542, we recommend you to check Nike's last-minute market performance to make sure the company can sustain itself at a future point.

Our Bottom Line On Nike Inc

Although some other entities within the footwear & accessories industry are still a little expensive, even after the recent corrections, Nike may offer a potential longer-term growth to shareholders. In closing, as of the 14th of January 2023, we believe that at this point, Nike is undervalued with very small probability of financial unrest within the next 2 years. Our current Buy-Hold-Sell recommendation on the firm is Strong Buy.

Editorial Staff

Gabriel Shpitalnik is a Member of Macroaxis Editorial Board. Gabriel is a young entrepreneur and writes predominantly on the business, technology, and finance sector. He likes to analyze different equity instruments across a wide range of industries focusing primarily on consumer products and evolving technologies. View Profile
This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Gabriel Shpitalnik do not own shares of Nike Inc. Please refer to our Terms of Use for any information regarding our disclosure principles.

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