Nike's (NKE 0.53%) sales are bouncing back after initially falling at the pandemic's onset. Nike was able to shift its focus to digital sales quickly, and that's proving to be the difference-maker. Clearly, the company faces difficulties at its own and its partners' brick-and-mortar stores, but it's hoping that digital growth will more than offset those declines. Indeed, the company has put itself within striking distance of reporting a revenue increase for the second quarter of fiscal 2021. Nike is set to report its results for the quarter on Dec. 18. 

Meanwhile, positive developments on coronavirus vaccines mean that the athletic apparel company's operations can potentially return to normal in the back half of 2021. Here are three important metrics investors should look at in this week's earnings report.

A woman jogging on a road.

Nike increased its dividend by 12%. Image source: Getty Images.

Nike is rebounding

The first thing investors will want to look at is Nike's overall revenue, which declined by 1% in the company's fiscal first quarter. It will certainly help that nearly all of its stores are open again. However, with coronavirus cases surging worldwide, it's unclear what appetite consumers have for shopping in person. Fortunately, Nike has a robust digital channel to help shoppers who would like to buy its products from the safety of their homes.

The second thing shareholders will be interested in is Nike's share buyback program. The company suspended share repurchases in March, in part to conserve cash in an uncertain environment. Nike might announce in this week's earnings report that it will resume buying back its own shares. It recently increased its dividend by 12%, signaling its commitment to return capital to shareholders. If Nike reinstates its buyback program, it would show investors that management feels confident in the company's prospects and believes the stock is undervalued.

Lastly, investors will want to look for what management has to say about holiday sales progress thus far. This holiday season is unlike any in recent history, and so it will be important to hear if the seasonal increase in consumer spending is flowing through to Nike. Interestingly, the company ended August with inventory up 15% from a year earlier. If the demand is there from customers, Nike has plenty of inventory to sell.

A woman lacing up her shoes.

Nike shares are up over 30% in 2020. Image source: Getty Images.

What this could mean for investors 

On average, Wall Street analysts are forecasting that Nike will report revenue of $10.55 billion and earnings per share of $0.61 for the fiscal second quarter. If the company hits those targets, it will be an increase of 2.2% for revenue and a 13% decrease in EPS.

Nike stock has already gained 37% year to date, despite the lack of a robust sales recovery. If the company reports earnings below expectations and talks pessimistically about holiday sales and profit margins, look for the price of this consumer goods stock to pull back after the earnings release. Still, investors should not be alarmed by short-term movements in the stock price and can treat a price drop as a buying opportunity.