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Nike (NYSE:NKE) Financial Strength

: 8 (As of Aug. 2022)
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Nike has the Financial Strength Rank of 8. It shows strong financial strength and is unlikely to fall into distressed situations.

Good Sign:

Nike Inc shows strong financial strength.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Nike's Interest Coverage for the quarter that ended in Aug. 2022 was 130.38. Nike's debt to revenue ratio for the quarter that ended in Aug. 2022 was 0.25. As of today, Nike's Altman Z-Score is 6.45.


Nike (NYSE:NKE) Financial Strength Competitive Comparison

For the Footwear & Accessories subindustry, Nike's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Nike (NYSE:NKE) Financial Strength Distribution

For the Manufacturing - Apparel & Accessories industry and Consumer Cyclical sector, Nike's Financial Strength distribution charts can be found below:

* The bar in red indicates where Nike's Financial Strength falls into.



Nike Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Nike's Interest Expense for the months ended in Aug. 2022 was $-13 Mil. Its Operating Income for the months ended in Aug. 2022 was $1,695 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Aug. 2022 was $11,658 Mil.

Nike's Interest Coverage for the quarter that ended in Aug. 2022 is

Interest Coverage=-1*Operating Income (Q: Aug. 2022 )/Interest Expense (Q: Aug. 2022 )
=-1*1695/-13
=130.38

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Nike's Debt to Revenue Ratio for the quarter that ended in Aug. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Aug. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(933 + 11658) / 50748
=0.25

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Nike has a Z-score of 6.45, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 6.45 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Nike  (NYSE:NKE) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Nike has the Financial Strength Rank of 8. It shows strong financial strength and is unlikely to fall into distressed situations.


Nike Financial Strength Related Terms

Thank you for viewing the detailed overview of Nike's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Nike (NYSE:NKE) Business Description

Nike logo
Address
One Bowerman Drive, Beaverton, OR, USA, 97005-6453
Nike is the largest athletic footwear and apparel brand in the world. It designs, develops, and markets athletic apparel, footwear, equipment, and accessories in six major categories: running, basketball, soccer, training, sportswear, and Jordan. Footwear generates about two thirds of its sales. Nike's brands include Nike, Jordan, and Converse (casual footwear). Nike sells products worldwide and outsources its production to more than 300 factories in more than 30 countries. Nike was founded in 1964 and is based in Beaverton, Oregon.
Executives
Miller Ann M officer: EVP & General Counsel ONE BOWERMAN DRIVE BEAVERTON OR 97005
O'neill Heidi officer: PRES: CONSUMER AND MKTPLC C/O SKULLCANDY, INC. 1441 WEST UTE BOULEVARD, SUITE 250 PARK CITY UT 84098
Friend Matthew officer: EVP: CFO ONE BOWERMAN DRIVE BEAVERTON OR 97005
Duckett Thasunda director ONE BOWERMAN DRIVE BEAVERTON OR 97005
Rogers John W Jr director ARIEL CAPITAL MANAGEMENT, INC. 200 EAST RANDOLPH DRIVE, SUITE 2900 CHICAGO IL 60601
Benko Cathleen A director ONE BOWERMAN DRIVE BEAVERTON OR 97005
Henry Peter B. director C/O NEW YORK UNIVERSITY/KAUFMAN MGT CNT 44 WEST 4TH STREET, SUITE 11-160 NEW YORK CITY NY 10012
Matheson Monique S. officer: EVP: HR ONE BOWERMAN DRIVE BEAVERTON OR 97005
Swoosh, Llc 10 percent owner ONE BOWERMAN DRIVE BEAVERTON OR 97005
Spillane Michael officer: PRES: PRODUCT & MERCHANDISING ONE BOWERMAN DRIVE BEAVERTON X1 97005
Campion Andrew officer: EVP: CFO, other: EVP: CFO ONE BOWERMAN DRIVE BEAVERTON OR 97005
Abston Chris L officer: VP: CORP CONTROLLER, other: VP: CORP CONTROLLER ONE BOWERMAN DRIVE BEAVERTON OR 97005
Knight Travis A director ONE BOWERMAN DRIVE BEAVERTON OR 97005
Donahoe John J director C/O PAYPAL HOLDINGS INC 2211 NORTH FIRST STREET SAN JOSE CA 95131
Peluso Michelle A director 3150 SABRE DRIVE SOUTHLAKE TX 76092

Nike (NYSE:NKE) Headlines

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