What to Expect When Nike Reports

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Nike Inc. (NYSE: NKE) is scheduled to release its fiscal fourth-quarter financial results after the markets close on Thursday. The consensus estimates from Thomson Reuters are $0.64 in earnings per share (EPS) on $9.41 billion in revenue. In the same period of last year, the shoemaker said it had EPS of $0.60 and $8.68 billion in revenue.

Ahead of the earnings report, Wedbush issued an Outperform rating for the stock, also raising its price target of $82 from $75, implying an upside of 14.4% from the current price level. The firm expects to see EPS of $0.68 and sales of $9.4 billion for the fourth quarter as well, edging out the consensus on the bottom line.

Wedbush pointed out that Nike began to see real progress on several fronts in North America this year, including inventory management, product and engagement, that should translate into growth in fiscal 2019.

According to the brokerage firm:

On the margin, Nike is poised to return to G/M expansion for the first time in eight consecutive quarters as FX pressure, DTC and ASP turn to a more meaningful tailwind. Finally, SG&A growth will likely be slightly above levels articulated during its analyst meeting (slight leverage), which is warranted given the inflection in NA and key global events (World Cup). In all, Nike’s multiple accelerates as sales momentum builds and G/M rates are expanding, which in our view are key factors in fiscal 2019.

A few other analysts weighed in on Nike ahead of the report as well:

  • Goldman Sachs has a Neutral rating with a $78 price target.
  • Buckingham Research has a Neutral rating and an $80 target.
  • Robert Baird has an Outperform rating and an $82 price target.
  • UBS has a Neutral rating with a $78 price target.
  • Stifel has a Buy rating with an $87 target price.
  • Barclays has a Buy rating and an $80 price target.

Shares of Nike were last seen at $71.70, with a consensus analyst price target of $74.98 and a 52-week trading range of $50.35 to $75.91.