CFDs are complex instruments. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money. CFDs are complex instruments. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

Nike shares: earnings beat, forward guidance disappoints

Nike shares are struggling to find momentum in all-sessions trading after finishing the session lower on Monday after fourth quarter earnings were released.

(Video Transcript)

Nike Q4 earnings

We've seen earnings out from NIKE Inc (All Sessions) last night, and despite posting better than expected numbers, the share was still down in extended hours after the release as the group has forecasted first quarter (Q1) revenue below estimates.

Earnings came in at $0.19 per share on revenues of $12.23 billion. Analysts had expected earnings per share (EPS) of $0.81 and revenue of $12.07 billion.

Nike: technical analysis

Let's bring up the chart now to see how Nike is trading.

Now, remember, this is an all-session share on the IG platform, which means you can trade it from 9 a.m. UK time prior to the US open later on this afternoon.

And as you can see, the reaction yesterday selling off after the announcement there, coming down to end the session down about 4.8% on the day. So far today, we have opened pretty much unchanged, not much move, seeing a little bit of momentum to the upside, trying to recover some of that move, especially on those better-than-expected earnings.

But if we're looking at the messaging around this, we saw chief financial officer, Matthew Friend, say that Nike is taking a cautious approach to greater China given the uncertainty around additional Covid disruptions and expect first quarter revenue to be flat to slightly up, below estimates of a 5.1% increase.

So that's the outline there from the messaging from those earnings. As we know, markets have been focusing a lot lately on forward guidance, what's going to come, especially now that we've seen inflation and costs gearing up. A lot of focus now on what are they going to deliver in the upcoming few months.

We've seen the message, still expecting to see a little bit of a gain there for Nike. But below expectations that we've seen so far, the share remains within this descending channel, you can see.

But if we zoom out a little bit, just to get the greater picture here, you can see we're still very much within that higher trend compared to where we started prior to the Covid rally. This is the beginning of 2020 here, the beginning of the summer. You can see we're now nearing that area, an area that's potentially more sustainable. Now, undone most of that Covid rally coming to rest around that area here. The 100 area at the moment, it's likely that we see a bit more price instability along this area and also finding a bit more support from where we've seen those previous lows, helping the price, trying to push higher and break this descending channel.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.