Fast Money Blog- 12/23/21
Nike, Inc. (NKE) Q2 2022 Earnings
This week on Wall Street Nike, Inc. (NKE) shocked the world with positive earnings. So, here’s the scoop:
On Monday, December 20th, Nike, Inc. released its financial results for Q2 2022. The company posted top-line revenue of $11.4 billion, which is a 1% increase year-over-year. However, sales in North America, Nike’s biggest market, climbed 12%. The company also saw very successful North American Black Friday sales, which were up over 20% year-over-year.
Nike Direct sales rose 9% year-over-year, while Digital sales increased 12% year-over-year. You should also know that Nike Digital is now 25% of total NIKE Brand revenue.
Although it wasn’t officially part of the earnings, celebrity deals with Serena Williams, Michael Jordan, LeBron James, Cristiano Ronaldo and Rafael Nadal, positively impacted the companies top-line. The greater the performance of these sports icons, the higher the sales.
So here’s how celebrity endorsements help drive Nike’s top-line revenue higher:
Of all the 30 Dow Stocks, Nike leads in celebrity endorsements which helps drive sales. When these Nike superstar endorsers post in social media they are frequently, if not always, seen in Nike apparel. These social media posts drive Nike sales, as they include hashtags and links taking you back to the Nike website.
Now, let’s look at the power of the swoosh symbol. Along with the McDonald’s “M", the Nike swoosh symbol is one of the most recognizable brand logos in the world. Have you noticed that every major team in the NFL and NBA have the swoosh symbol embedded on team jersey? That means that whenever there is a major sporting event, the Nike brand benefits from maximum exposure.
Here are my final Wealthy Investor thoughts on Nike’s future stock performance:
Dow component Nike stock will continue to climb as long as every top-celebrity endorser increases their success and breaks sporting records. Nike, Inc. (NKE) is a great trade and long-term investment.
Stay smart, stay disciplined, stay focused.
Tyrone Jackson, The Wealthy Investor