Nike Sees Decline in Profits; Beats Estimates (NKE)

Nike Sees Decline in Profits; Beats Estimates (NKE)

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Footwear retailer, Nike Inc(NKE) reported a drop in profits, but beat analysts earnings estimates on Friday.

The Beaverton, OR based company reported second quarter earnings of $384 million, or $1.14 per share, down 22% from last years Q2 earnings of $469 million, or $1.03 per share. Wall street analysts expected EPS of $1.

NKE reported revenue of $5.96 billion for the quarter, up from $5.55 billion last year, but missing analysts estimates of $6.01 billion.

Although the company increased prices on products while lowering the cost of raw materials, costs were offset by unfavorable exchange rates and high labor costs.

Sales were down in both China and Western Europe, but increased by 17% in North America. Sales in emerging markets also increased this quarter.

Nike shares were up $4, or 4.04% during premarket trading Friday. The stock is up 2.7% YTD.

The Bottom Line
Shares of Nike (NKE) have a .85% dividend yield, based on last night’s closing stock price of $99.00. The stock has technical support in the $95 price area. If the shares can firm up, we see overhead resistance around the $104-$105 price levels.

Nike, INC(NKE) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

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