The 10-second takeaway
For the quarter ended Aug. 31 (Q1), Nike beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share dropped.
Margins dropped across the board.
Nike recorded revenue of $6.67 billion. The 15 analysts polled by S&P Capital IQ expected revenue of $6.43 billion on the same basis. GAAP reported sales were 9.7% higher than the prior-year quarter's $6.08 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.23. The 17 earnings estimates compiled by S&P Capital IQ forecast $1.12 per share. GAAP EPS of $1.23 for Q1 were 9.6% lower than the prior-year quarter's $1.36 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 43.5%, 80 basis points worse than the prior-year quarter. Operating margin was 11.2%, 310 basis points worse than the prior-year quarter. Net margin was 8.5%, 210 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $6.01 billion. On the bottom line, the average EPS estimate is $1.03.
Next year's average estimate for revenue is $25.34 billion. The average EPS estimate is $5.14.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,276 members out of 2,401 rating the stock outperform, and 125 members rating it underperform. Among 647 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 620 give Nike a green thumbs-up, and 27 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Nike is outperform, with an average price target of $104.37.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Nike. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.