One-glance verdict
Undervalued
$71.36 our estimate vs market $40.75
Wall Street consensus: $58.13 (-18.5% lower than our fair-value estimate)
43% below our estimate, below the bear case
Fundamentals snapshot
NIKE, Inc.
NKE · NYQ · Consumer Cyclical · Footwear & Accessories
Current price
$40.75
52-week range
$40.00 - $80.17
Market cap
$60.35B
Balance sheet
Healthy
34.60x Strong cushion
Net debt $3.12B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 0.5% last year.
- Reward Returns 16.0% on equity, ahead of 16% of its peers.
- Reward Free cash flow was positive in 10/10 years.
- Risk Operating margin compressed from 14.3% to 6.9% over 3 years.
What this company does
NIKE, Inc.
Nike is a global company that sells athletic shoes, clothes, and gear under popular brands like Nike, Jordan, and Converse. It makes money by selling products to other retailers and, increasingly, directly to customers through its own stores and website. This direct-to-consumer push is important because it can lead to higher profit margins (the percentage of each sale the company keeps as profit) and gives Nike more control over its brand experience.
How the company got here
Originally named Blue Ribbon Sports, the company was founded in 1964 by a University of Oregon track athlete and his coach, Phil Knight and Bill Bowerman. Initially, they were a distributor for a Japanese shoe brand. A key moment came in 1971 when they launched their own line of footwear, rebranded as NIKE, Inc., and introduced the iconic 'Swoosh' logo. The company's growth soared after signing a rookie basketball player named Michael Jordan in 1984 to an endorsement deal, creating the legendary Air Jordan line and cementing Nike's cultural influence.
What it actually does
NIKE is a global company that designs, develops, and sells athletic and casual products. Most people know them for their sneakers, like the Air Force 1, Air Max, and various Jordan models, but they also sell a wide range of sports apparel, equipment, and accessories for men, women, and children. You'll find their products in their own retail stores, on their websites and apps, and in thousands of other stores worldwide, from big department stores to local skate shops. Beyond physical products, Nike also offers digital services like fitness and activity apps to connect with its customers.
NIKE Brand
This is the company's main and largest business, encompassing all products sold under the NIKE and Jordan brands. It's broken down into three main product categories: Footwear, Apparel, and Equipment. Footwear, or sneakers, is the biggest money-maker by a large margin, consistently bringing in well over half of the company's total revenue. Apparel is the second-largest category, while Equipment, which includes items like bags, balls, and gloves, makes up the smallest portion of sales.
Converse
Converse is a separate brand that NIKE has owned since 2003. It's famous for its own iconic shoes, like the Chuck Taylor All-Stars, which have a distinct, retro style compared to the more performance-focused NIKE brand products. While it's a much smaller part of the overall company, Converse generates significant revenue and operates as a distinct subsidiary (a company owned by a larger parent company).
What management is betting on now
For several years, Nike focused heavily on a 'Direct-to-Consumer' strategy, aiming to sell more products through its own stores and websites to better control the customer experience and keep more profit from each sale. However, the company has recently acknowledged this shift went too far and is now re-emphasizing its relationships with wholesale partners (other retailers that sell Nike products). The current strategy involves finding a better balance between selling directly to people and selling through other stores to ensure their products are available wherever customers are shopping. The company also continues to invest in digital innovation, using its apps and online platforms to build a strong community and gather data on what customers want.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$2.41B
FY2025 Q1
$274.00M
FY2025 Q2
$920.00M
FY2025 Q3
$1.71B
FY2025 Q4
$363.00M
FY2026 Q1
$15.00M
FY2026 Q2
$386.00M
FY2026 Q3
$284.00M
Revenue
$11.28B
Net income
$520.00M
Diluted EPS
0.35
Operating cash flow
$430.00M
Free cash flow
$284.00M
Fetching…
Sources
Revenue
$12.43B
Net income
$792.00M
Diluted EPS
0.53
Operating cash flow
$579.00M
Free cash flow
$386.00M
Fetching…
Sources
Revenue
$11.72B
Net income
$727.00M
Diluted EPS
0.49
Operating cash flow
$222.00M
Free cash flow
$15.00M
Fetching…
Sources
Revenue
$11.10B
Net income
$211.00M
Diluted EPS
0.14
Operating cash flow
$463.00M
Free cash flow
$363.00M
Fetching…
Sources
Revenue
$11.27B
Net income
$794.00M
Diluted EPS
0.54
Operating cash flow
$1.79B
Free cash flow
$1.71B
Fetching…
Sources
Revenue
$12.35B
Net income
$1.16B
Diluted EPS
0.78
Operating cash flow
$1.05B
Free cash flow
$920.00M
Fetching…
Sources
Revenue
$11.59B
Net income
$1.05B
Diluted EPS
0.70
Operating cash flow
$394.00M
Free cash flow
$274.00M
Fetching…
Sources
Revenue
$12.61B
Net income
$1.50B
Diluted EPS
0.99
Operating cash flow
$2.62B
Free cash flow
$2.41B
Fetching…
Sources
Is it cheap or expensive?
Fair value $71.36 vs current price $40.75
Wall Street consensus is the average analyst price target: $58.13 (-18.5% lower than our fair-value estimate).
Our most-likely fair value is $71.36 a share — about 75.1% above today's price of $40.75, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net debt $3.1B. Interest coverage 34.6x.
Net debt
$3.12B
Interest coverage
34.60x
NIKE, Inc.'s profit covers its interest bill about 34.6 times over. which is stronger than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
NKE
BASELINE
NIKE, Inc.
Total debt $11.18B Interest coverage 34.60x This is the baseline the peer rows are being compared against.
Total debt $6.78B Interest coverage 9.04x -74% vs NKE Carries about 3.8x less debt cushion than NKE.
Total debt $375.19M Interest coverage 499.17x +1,343% vs NKE Carries about 14.4x more debt cushion than NKE.
Total debt $4.98B Interest coverage 3.64x -89% vs NKE Carries about 9.5x less debt cushion than NKE.
Total debt $1.94B Interest coverage -1.17x -100% vs NKE This peer has almost no interest-payment cushion compared with NKE.
What you should know
The case for and against NKE
3 Rewards
1 Risk
Rewards
-
Revenue grew 0.5% last year.
-
Returns 16.0% on equity, ahead of 16% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Operating margin compressed from 14.3% to 6.9% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
26.81x
Forward P/E
22.61x
P/B
4.28x
P/S
1.30x
EV/EBITDA
16.43x
PEG ratio
1.46x
Profitability
How much profit each dollar creates
Gross margin
40.9%
Operating margin
6.9%
Net margin
4.8%
ROE
16.0%
ROA
5.2%
Health
Liquidity and balance-sheet strength
Debt / equity
0.79x
Current ratio
2.14x
Quick ratio
1.24x
Total debt
$11.18B
Total cash
$8.06B
Growth
How the business has been compounding
Revenue TTM
$46.52B
Revenue 5Y CAGR
1.0%
EPS TTM
1.52
EPS 5Y CAGR
-16.8%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.69B
Free CF TTM
$3.27B
FCF margin
7.0%
Dividend
Shareholder payout
Yield
4.0%
Payout ratio
106.6%
Last ex-div date
2026-06-01