Nike Beats Analyst Estimates on EPS

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Nike (NYS: NKE) reported earnings yesterday. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Feb. 29 (Q3), Nike met expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew significantly, and GAAP earnings per share increased.


Margins contracted across the board.

Revenue details
Nike reported revenue of $5.85 billion. The 15 analysts polled by S&P Capital IQ predicted net sales of $5.82 billion on the same basis. GAAP reported sales were 15% higher than the prior-year quarter's $5.08 billion.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.20. The 18 earnings estimates compiled by S&P Capital IQ anticipated $1.17 per share. GAAP EPS of $1.20 for Q3 were 11% higher than the prior-year quarter's $1.08 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 43.8%, 200 basis points worse than the prior-year quarter. Operating margin was 13.0%, 60 basis points worse than the prior-year quarter. Net margin was 9.6%, 70 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $6.55 billion. On the bottom line, the average EPS estimate is $1.39.

Next year's average estimate for revenue is $24.19 billion. The average EPS estimate is $4.93.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,108 members rating the stock outperform and 124 members rating it underperform. Among 648 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 625 give Nike a green thumbs-up, and 23 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Nike is outperform, with an average price target of $108.24.

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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of Nike. Motley Fool newsletter services have recommended creating a diagonal call position in Nike. The Motley Fool has a disclosure policy.

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