Stock of the day: Nike

Shares are hitting 52-week highs as Nike investors applaud the first-quarter earnings report.

By Motley Fool Investor Beat Sep 27, 2013 3:15PM

Consumer sports giant Nike (NKE) reported first-quarter earnings for fiscal year 2014 yesterday, and investors and analysts alike have cheered the news this morning. Shares are up around 5%, leading to fresh 52-week highs.

 

Nike managed to grow revenue by 8% to $7 billion, reporting earnings per share of $0.86. EPS grew by a staggering 37%. Gross margin increased to 44.9%, thanks in part to the direct-to-consumer segment. Analysts sat up and took notice of the better-than-expected report: Sterne Agee upgraded the stock on the news, and Deustche Bank raised its price target.

Motley Fool analyst Jason Moser points out that a global entity like Nike always has areas of concern. For one, Chinese sales were down somewhat. Nike reported growth for the NIKE brand in every market, with the lone holdout being Greater China.
 
©HANDOUT/Newscom/RTR/ReutersHowever, direct-to-consumer sales saw close to 20% growth, helping to offset that decline. Jason sees Nike as a quintessential long-term holding, and says this reliable stock is worth buying on a dip.
 
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