Crista Huff

While sports enthusiasts focus on the Euro 2012 soccer championship, stock enthusiasts should be focusing on a growing leader in the global soccer goods market.  NIKE now has a 36% market share via its sports apparel and equipment products, almost equalling the long-dominant Adidas which holds a 38% market share.

NIKE, Inc. (NKE, $107.46) is a world leader in the athletic apparel & equipment market.  NIKE markets its products to over 170 countries, with an audience ranging from the non-athletic consumer to college & professional sports teams.  Its footwear business alone dominates 50% of that market.

A small percentage of the company's products include the brands Cole Haan and Umbro, which it plans to divest by year-end 2013, and also Converse, Hurley, and Nike Golf.  "We view this [divestiture] as a positive as this focus should enable to company to invest resources on the highest potential opportunities for Nike such as Nike, Jordan, Converse, and Hurley," says Citi Investment Research & Analysis (CIRA).  CIRA recommends a "buy" on NKE stock, and continues, "NKE is a solid global growth opportunity with exposure to emerging middle classes, has a heritage of innovation and creating new categories, is in the midst of strong product cycles, has compelling revenue and margin channel drivers (in addition to international, also direct to consumer retail and eCommerce channels)."

NKE Chart

NKE data by YCharts

2011 was a record year for NIKE.  They achieved revenues of $20.9 billion and net income of $2.1 billion.  S&P comments, "We see revenues reaching $24.2 billion in FY 12 (May) and $26.7 billion in FY 13, supported by product innovation, category penetration, and geographic expansion.  The company has also launched new retailing and marketing strategies designed to more closely align its operations with key markets."  NIKE is capturing global market share, especially in China and emerging markets.

Wall Street expects earnings per share (EPS) to increase 12%, 17% and 16% in fiscal years 2012 through 2014.

Crista Huff

Crista Huff is a retired stockbroker from a NYSE member investment firm. She writes about market-timing at Goodfellow LLC and is active politically.
TOWNHALL DAILY: Be the first to read Crista Huff's column. Sign up today and receive daily lineup delivered each morning to your inbox. Release of Liability: Through use of this website viewing or using you agree to hold and its employees harmless and to completely release and its employees from any and all liability due to any and all loss (monetary or otherwise), damage (monetary or otherwise), or injury (monetary or otherwise) that you may incur. Goodfellow LLC and its employees are not paid by third parties to promote nor disparage any investment. Recommendations are based on hypothetical situations of what we would do, not advice on what you should do. Neither Goodfellow LLC nor its employees are licensed investment advisors, tax advisors, nor attorneys. Consult with a licensed investment advisor and a tax advisor to determine the suitability of any investment.