Nike Stock - Quick Analysis #shorts
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Nike also has one of the strongest brands in the world. A recent report by Interbrands put Nike’ brand value at around 50 billion dollars which is roughly one quarter of the current market cap.
If we look at another historical chart, this blue line shows Nike stock at 25 times earnings, so you can see 25 times earnings has been a pretty good time to buy Nike over the last few years..
To put Nike stock into perspective, let’s say the company manages to grow earnings 10% per year for the next 10 years, and it manages to increase its dividend 10% a year as well. Assume you reinvest those dividends and then the stock trades at 30 times earnings at the end of those 10 years. That would take the share price up to around 310 in 10 years time for an investment return of around 9.5% per year.
So that’s not bad. You can’t do too much wrong with Nike stock but it does look pretty fairly valued and I’d like to get it a bit cheaper. But these are my own opinions not financial advice and I do own some Nike shares. For more detailed investing ideas visit our website overlookedalpha.com
#stocks #investing #overlookedalpha #financialtimes #nikestock
Nike also has one of the strongest brands in the world. A recent report by Interbrands put Nike’ brand value at around 50 billion dollars which is roughly one quarter of the current market cap.
If we look at another historical chart, this blue line shows Nike stock at 25 times earnings, so you can see 25 times earnings has been a pretty good time to buy Nike over the last few years..
To put Nike stock into perspective, let’s say the company manages to grow earnings 10% per year for the next 10 years, and it manages to increase its dividend 10% a year as well. Assume you reinvest those dividends and then the stock trades at 30 times earnings at the end of those 10 years. That would take the share price up to around 310 in 10 years time for an investment return of around 9.5% per year.
So that’s not bad. You can’t do too much wrong with Nike stock but it does look pretty fairly valued and I’d like to get it a bit cheaper. But these are my own opinions not financial advice and I do own some Nike shares. For more detailed investing ideas visit our website overlookedalpha.com
#stocks #investing #overlookedalpha #financialtimes #nikestock
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NewsTranscript
00:00 At a share price of $124, Nike stock has a market cap of $195.7 billion with $10.6 billion of cash
00:08 including short term investments and $8.9 billion of long term debt, the enterprise value is around
00:13 $194 billion. Looking at a historical chart, Nike typically trades between 20 to 30 times earnings,
00:20 so the current 35 times earnings multiple is not cheap. If we look at another historical chart,
00:25 this blue line shows Nike stock at 25 times earnings. So you can see the 25 times earnings
00:30 line has been a pretty good time to buy Nike over the last few years. To put Nike stock into
00:35 perspective, let's say the company manages to grow earnings 10% per year for the next 10 years
00:40 and it manages to increase its dividend 10% a year as well. Assume you reinvest those dividends and
00:45 then the stock trades at 30 times earnings at the end of those 10 years. That would take the share
00:50 price up to around $310 in 10 years time for an investment return of around 9.5% per year.