Nike Still Setting the Pace
Today, with China showing modest growth improvements, combined with strong acceleration in Nike's futures, the athletic-wear giant, which has never struggled with market share, is poised to recapture any margin leverage it has lost. And if the company's recent results serve as indication, investors who've been waiting patiently on the sidelines for this stock to fall down to fair value are going to be very disappointed.
Unlike at any point during this past fiscal year, Nike's first-quarter results made me wonder "What China problem?" This is the same question that rivals like Under Armour
In that regard, given the 38% growth in net income, which beat Street estimates by 8 cents a share, it's safe to say that Nike's management continues to pull all of the right strings. Revenue, meanwhile, advanced 8% year over year, helped by robust growth in North America. For that matter, except for China, where revenue declined 3% (excluding currency impacts), Nike saw growth in every other region.