Nike shares climb as it beats forecasts
Nike shares climbed all-sessions last night on the IG platform after the company beat Wall Street's expectations for its fiscal third quarter earnings and revenue.
This comes as Nike's margins have continued to shrink as investors watch for its direct-to-consumer strategies to pay off.
Earnings per share (EPS) came in at 79 cents, compared to 55 cents expected, driving a net income of $1.2 billion, compared with $1.4 billion, or 87 cents per share, a year earlier. Revenue was also better than forecast, at $12.39 billion versus $11.47 billion expected.
Nike, like other retailers, has been in the process of offloading a glut of inventory brought on by supply chain disruptions and shifting consumer demand that's been weighing on its margins.
Nike shares rise
One of the stocks on the IG platform that rose late in the session yesterday was Nike, the sportswear manufacturer. It rose all-sessions last night after the company beat Wall Street expectations for its fiscal third quarter (Q3) numbers on earnings and revenue, though its margins have continued to shrink as investors watch for its direct to consumer strategies still to pay off.
Let's take a look at the figures. Earnings per share (EPS) came in at $0.79 compared to $0.55 expected, driving a net income of $1.2 billion, compared with $1.4 billion or $0.87 per share this time last year. Revenue was also better than forecast at $12.39 billion against $11.47 billion forecasted.
Meanwhile, Nike, like other retailers, has been in the process of offloading a glut of inventory brought on by supply chain disruptions and shifting consumer demands. And it's been been weighing on its margins. I think overall, the story did produce this rather interesting rise in the stock yesterday.
Share price chart
If you look at the all-sessions stock on the IG platform, you can see that massive spike that we had. And in fact, we even rose above this line of resistance at 13130, which took us at one point yesterday, albeit briefly, to levels not seen since the 22nd of April 2022. Then came some market reality, but we did nonetheless see the stock up 1.2% at the close overall on the session in yesterday's trade.
The chief executive of Nike, John Donahoe, told investors last quarter he believes the company is past its inventory peak. Gross margins are expected to take a hit during the holiday quarter as the company continued liquidation efforts and promotions. But since then things have been improving and this has been the reaction to Nike's announcement late last night. The stock up in the end up 1.2%.
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