Companies and Brands

Nike Worst Performing Dow Stock Of 2016, Down 17.6%

Douglas A. McIntyre

Published: November 27, 2016 7:58 am

Last Updated: January 12, 2020 5:25 pm

Shares of Nike (NYSE: NKE) have been slaughtered in 2016, down the most of any Dow (DJIA) stock. Shares have fallen 17.8% to $51.52 this year. The Dow is higher by 9.9% for the same period to 19,152

Nike is no longer the growth stock it once was, although revenue growth is healthy. Recently, it has faced a resurgent Adidas, the second largest company in the category, white-hot Under Armour (NYSE: UA), and China’s Anta Sports Products

Another drag on Nike shares are the extent to which athlete endorsers are critical to sales. Nike has the grandfather of these in Michael Jordan, but he is years past his basketball career. Nike competitors have tried to flank it in every sport from soccer to basketball. Large endorsement deals can be work in the tens of millions of dollars.

In its most recent fiscal quarter, Nike’s results:

• Revenues up 8 percent to $9.1 billion; 10 percent growth excluding currency changes*
• Diluted earnings per share up 9% to $0.73 compared to prior year
• Worldwide futures orders up 5 percent; 7 percent growth excluding currency changes
• Inventories as of August 31, 2016 up 11 percent

Wall St. may not consider 10% real growth