Investing in the stock market doesn't require a ton of cash. After taking care of more pressing matters like paying off high-interest debt and setting aside an emergency fund, you can invest with even a smaller sum of capital. That way, you'll be well on your journey to building wealth for retirement. 

If you have $1,000 that's ready to invest, it's time to look at one stock in particular. I'm talking about sports-apparel juggernaut Nike (NKE 0.66%). 

Nike is facing some problems 

While the broader S&P 500 has lost 24% this year, Nike shares are down a whopping 47%. And this poor performance from Nike might be warranted.

The company's fiscal 2023 Q1 revenue and diluted earnings per share (EPS) exceeded Wall Street analyst estimates, but quarterly sales of $12.7 billion were up just 3.6% year over year. Diluted EPS actually fell 19.8%, compared to the prior-year period. 

Perhaps the biggest problem facing Nike right now is the massive buildup of inventory. Over the past 1.5 years, companies have had to deal with struggling supply chains, higher freight costs, and longer shipping times. So the prudent thing for management to do was order as much product as possible. But now, the situation has eased somewhat, and in Nike's case, its inventories jumped 44% (and 65% in North America) year over year in the latest fiscal quarter.  

In order to liquidate the excess inventory as quickly as possible so that fresh merchandise is on store shelves before the important holiday-shopping season, Nike is implementing more promotions and discounts than it would otherwise like to. This situation helps explain why the gross margin fell from 46.5% in Q1 2022 to 44.3% in the latest quarter. 

"As I previously discussed, we started to increase promotional activity in the first quarter and expect the broader marketplace to be promotional at least through the end of the calendar year," CFO Matt Friend mentioned on the Q1 2023 earnings call. Thankfully, the leadership team believes that inventory has peaked and should normalize going forward. 

Besides the massive inventory glut, Nike is also dealing with a delayed recovery in what has historically been its fastest-growing market, China. The country instituted pandemic lockdowns at various points over the past year, and this hurt the retail sector significantly. Sales in China declined 16% year over year. But management's positive long-term outlook in the nation hasn't changed. 

Nike is a buy-and-hold business 

Despite near-term issues, Nike still appears to be a buy-and-hold type of investment. And my perspective here comes down to one key factor that has supported the company's remarkable past success -- Nike's powerful brand. According to Piper Sandler's fall 2022 Taking Stock With Teens survey, 60% of respondents voted Nike as their favorite footwear brand and 31% of respondents voted Nike their favorite clothing brand. That's a valuable showing for the future of Nike, especially because the survey participants had an average age of under 16 years old. 

What's more, in the eyes of consumers, Nike sells a truly differentiated product. Wearing Nike merchandise is associated with a winning mentality, so much so that the business pays top-tier athletes tens of millions of dollars in endorsement money to maintain this image. Nike is a globally recognized brand, and this isn't changing anytime soon. 

The company will likely continue to drive long-term growth, given that the worldwide apparel market is currently valued at a gargantuan $1.5 trillion, according to Statista. Nike's trailing-12-month sales of $47.1 billion represent a tiny fraction of the market today. 

Nike has been around for almost 60 years, and its long and successful operating history gives me confidence that the brand will remain just as relevant, if not more so, for consumers decades from now. The company is firmly profitable and generates lot of free cash flow -- $4.4 billion in fiscal 2022, to be exact. And this helped fund a dividend payout of $1.8 billion. 

The next few quarters might be difficult as the economy continues to weaken. But Nike's long-term prospects remain solid. That makes the stock a wonderful investment to make with $1,000.