By:
On:
In: Fair company, Stock analysis
Tagged:
With: 4 Comments

Company name Nike Inc
Stock ticker NKE
Live stock price [stckqut]NKE[/stckqut]
P/E compared to competitors Good

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Poor
EPS growth Fair
P/E growth Poor
EBIT growth Fair

ANALYSIS

Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $65.65
Target stock price (averages with growth) $77.19
Target stock price (averages with no growth) $60.66
Target stock price (manual assumptions) $68.79

The following company description is from Google Finance: http://www.google.com/finance?q=nke

NIKE, Inc. (NIKE) is engaged in the design, development and worldwide marketing and selling of footwear, apparel, equipment, accessories and services. NIKE is a seller of athletic footwear and athletic apparel worldwide. The Company sells its products to retail accounts, through NIKE-owned retail stores and Internet sales, and through a mix of independent distributors and licensees, in approximately 190 countries around the world. The Company focuses its product offerings in seven key categories: Running, Basketball, Football (Soccer), Men’s Training, Women’s Training, NIKE Sportswear (its sports-inspired products) and Action Sports. It also markets products designed for kids, as well as for other athletic and recreational uses, such as baseball, cricket, golf, lacrosse, outdoor activities, football (American), tennis, volleyball, walking and wrestling. In February 2013, it sold its Cole Haan affiliate brand to APAX Partners LLP.

 

Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in this stock as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor.

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
[s2If current_user_can(s2member_level1)]
In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

Stock price at the time of the calculation: $66.82

Growth: 0.105

Current EPS (TTM): $2.69

P/E: 25

Future EPS Calc: $4.43

Future Stock Price Calc: $110.79

Target stock price: $68.79

I hope that this makes you a better investor. [/s2If]

By:
On:
In: Commentary
With: 0 Comments

There is nothing that will destroy your ability to save money for the future and invest in your own welfare like living beyond your means. I am often told by my readers (by email, Facebook, or Twitter) that they cannot afford to invest because they cannot even live on their own paycheck.

Far be it for me to tell someone else how to live and the personal decisions that individual or family has to make. I did read this article recently that impressed me for the frugality of these super-rich people. These people are not just rich; several of them are the 1% of the 1%. While I am sure there are certain aspects of their individual lives that we may deem excessive, it is important for all of us to do whatever is reasonable to reduce our daily costs of living. If you invest that savings, you have the potential for financial independence some day.

  • Legendary US investor Warren Buffett, who has an estimated net worth of $US54.6 billion, famously still lives in the same five bedroom house he bought 55 years ago for $US31,500.
  • Chuck Feeney, co-founder of Duty Free Shoppers who has donated his fortune of more than $US6 billion to charity, travels in economy class “because first class won’t get me to my destination any faster”. He doesn’t own a house or a car and wears a $15 watch.
  • Ikea founder Ingvar Kamprad also prefers to fly economy class, and prefers to book with budget airlines. He also encourages his Ikea staff not to be wasteful, and tells people off if they don’t use both sides of a sheet of paper or leave lights on when they leave a room.
  • US oil magnate T. Boone Pickens, worth $US1.2 billion, reportedly shops with a grocery list and only carries enough cash in his wallet to cover what he is about to buy for better budgeting.
  • Indian mogul Azim Premji, worth an estimated $US11.2 billion, drove a Ford Escape for eight years before he traded it with a Toyota Corolla. When he travels he prefers budget hotels over five-star accommodation.