Here is what you need to know why Nike, Inc. (NKE) is a trend share

Nike (Nke) was recently on the list of the most sought -after stocks from Zacks.com. Therefore, you may want to take some of the key factors into account that could influence the performance of the share in the near future.

Last month, the shares of this sports clothing manufacturer have returned +15.3% compared to the changes in the Zack S&P 500 Composite +9%. During this time, the Zacks shoes and the retail clothing industry in which Nike falls have increased 13%. The key question now is: What could be the future direction of the stock?

Although media reports or rumors about a significant change in the business prospects of a company generally lead to the fact that its shares lead to trend and an immediate change in price, there are always certain basic factors that ultimately advance the purchase and hate decision.

Instead of concentrating on anything else, we prioritize the evaluation of the change in the profit projection of a company at Zacks. This is due to the fact that we believe that the current value for its shares is determined by the cash value of his future profit current.

We essentially take a look at how analysts that cover the shares reveal their profit estimates in order to reflect the effects of the latest business trends. And if the profit estimates for a company rise, the current value for its shares increases. A higher atmosphere to be used than the current market price gives investors the interest for buying the share, which leads at a higher price. For this reason, empirical research shows a strong correlation between trends in the revisions of the yield estimate and short -term share price movements.

Nike is expected to make a profit of $ 0.11 per share in the current quarter, which corresponds to a change of -89.1%compared to the previous year. In the last 30 days, the Zacks Consensus estimate has changed +8.7%.

The consensus result estimate of $ 2.15 for the current financial year shows a change of -45.6%compared to the previous year. This estimate has changed +0.4% in the last 30 days.

For the next financial year, the consensus estimate of 1.94 USD shows a change of -9.8% compared to what Nike is expected a year ago. The estimate has changed last month -0.2%.

Our proprietary stock assessment tool, The Zacks Rank, offers a strong externally tested track record and offers a more conclusive picture of the price direction of a share at short notice, as it effectively uses the power of profits. Due to the size of the recent change in the consensus estimate and three other factors in connection with profit estimates, Nike is ranked 3rd (hold).

The following table shows the development of the company's 12-month consensus EPS EPS estimate:

12-month consensus EPS estimate for NKE _12MonthepScharturl

While profit growth is probably the most superior indicator of a company's financial health, nothing happens than such if a company cannot increase its income. After all, it is almost impossible for a company to increase its income over a longer period of time without increasing its income. It is therefore important to know the potential sales growth of a company.

For Nike, consensus sales for the current quarter of USD 10.65 billion shows a change of -15.5%compared to the previous year. For the current and next financial years, estimates of 45.87 billion US dollars and $ 45.23 billion indicate -10.7% or -1.4%.

Nike reported sales of $ 11.27 billion in the last quarter, which corresponds to a change of -9.3%compared to the previous year. EPS of $ 0.54 for the same period comparable to USD 0.98 a year ago.

Compared to the Zacks Consensus estimate of 11.03 billion US dollars, the registered income is a surprise of +2.13%. The EPS surprise was +92.86%.

The company defeated consensus -epseps estimates in each of the following four quarters. The company led the consensus sales estimates twice during this period.

Without taking into account the assessment of a share, no investment decision can be efficient. When predicting the future price performance of a share, it is crucial to determine whether the current price correctly reflects the internal value of the underlying business and the company's growth prospects.

The comparison of the current value of the valuation multipliers of a company, such as

The Zacks Value Style Score (part of the Zacks Style Scores Systems), which pays attention to the grade of stocks from A to F both traditional and unconventional valuation metrics (AA is better than a C; and so on) is rather helpful to identify whether a share is overrated, legally valued or temporarily accommodated.

Nike is evaluated on this front C, which points out that it will keep up with his colleagues. Click here to display the values of some evaluation metrics that have driven this grade.

The facts discussed here and a lot of other information about Zacks.com could help determine whether it is worth paying attention to the Nike market or not. However, the Zacks ranked 3rd indicate that it is in line with the broader market at short notice.

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This article was originally published in Zack's Investment Research (Zacks.com).

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