What is the AI rating for NKE?

NIKE, Inc. (NKE) has an AI rating of SELL with 72% confidence, based on fundamental analysis of SEC EDGAR filings.

What are the key strengths of NKE?

Solid balance sheet with $7.0B cash and manageable 0.50x debt/equity ratio. Adequate liquidity with 2.06x current ratio supporting operational needs. Gross margin of 41.4% remains respectable despite revenue pressure

What are the risks of investing in NKE?

Revenue declining 9.8% YoY with net income down 43.5% signals severe demand weakness and margin compression. Free cash flow margin of only 1.7% indicates poor cash generation relative to sales despite $401M FCF. Operating margin compression to 8.0% and net margin of 6.3% suggest pricing power loss or cost control issues

NKE Stock Analysis - NIKE, Inc. AI Rating & Fundamentals

Name: NIKE, Inc. (NKE) Stock
Brand: NIKE, Inc.
Rating: 2 (1 reviews)

Investment Thesis

Nike faces significant operational headwinds with revenue declining 9.8% YoY and net income collapsing 43.5% YoY, indicating severe margin compression and demand weakness. While the company maintains adequate liquidity (2.06x current ratio) and a reasonable debt/equity position (0.50x), the deteriorating cash generation (FCF margin of only 1.7%) and weak profitability trends suggest structural challenges in the business.

NKE Strengths

+ Solid balance sheet with $7.0B cash and manageable 0.50x debt/equity ratio
+ Adequate liquidity with 2.06x current ratio supporting operational needs
+ Gross margin of 41.4% remains respectable despite revenue pressure

NKE Risks

! Revenue declining 9.8% YoY with net income down 43.5% signals severe demand weakness and margin compression
! Free cash flow margin of only 1.7% indicates poor cash generation relative to sales despite $401M FCF
! Operating margin compression to 8.0% and net margin of 6.3% suggest pricing power loss or cost control issues
! Return metrics deteriorating (ROE 10.8%, ROA 4.0%) indicate declining asset productivity

Key Metrics to Watch

* Revenue growth trajectory - stabilization critical after 9.8% decline
* Operating margin expansion - must improve from current 8.0% to restore profitability
* Free cash flow conversion - FCF margin of 1.7% is unsustainably low and must improve significantly

NKE Financial Metrics

Revenue

$24.1B

Net Income

$1.5B

EPS (Diluted)

$1.03

Free Cash Flow

$401.0M

Total Assets

$37.8B

Cash Position

$7.0B

NKE Profitability Ratios

Gross Margin 41.4%

Operating Margin 8.0%

Net Margin 6.3%

ROE 10.8%

ROA 4.0%

FCF Margin 1.7%

NKE Balance Sheet & Liquidity

Current Ratio

2.06x

Quick Ratio

1.83x

Debt/Equity

0.50x

Debt/Assets

0.0%

Interest Coverage

N/A

Long-term Debt