Athletic apparel brand Nike (NYSE: NKE) will be reporting earnings this Thursday after the bell. Here’s what you need to know.
Nike beat analysts’ revenue expectations last quarter, reporting revenues of $10.97 billion, down 1.1% year on year. It was a very strong quarter for the company, with a beat of analysts’ EPS estimates.
Is Nike a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Nike’s revenue to decline 3.3% year on year, a reversal from the 1.1% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Nike rarely misses Wall Street’s revenue estimates.
Looking at Nike’s peers in the consumer discretionary segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Carnival delivered year-on-year revenue growth of 3.5%, beating analysts’ expectations by 1.1%, and Scholastic reported a revenue decline of 3.9%, falling short of estimates by 3.5%. Scholastic traded down 7.8% following the results.
Read our full analysis of Carnival’s results here and Scholastic’s results here.
In the last year or so, investors have shifted their focus from one macro dynamic to the next (AI disintermediation and AI investment to geopolitical conflict, interest rates, and the health of the wider economy). While some of the consumer discretionary stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 7.6% on average over the last month. Nike is down 8.1% during the same time and is heading into earnings with an average analyst price target of $45.63 (compared to the current share price of $35.88).
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