Nike (NKE) Still Has Room To Run - Cramer (DECK, SKX)
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Shares of Nike (NYSE: NKE) jumped after the company reported their thrid quarter earnings last Wednesday, March 17, 2010. The company had an EPS of $1.01, more than doubling its EPS Y/Y. Analysts looked for an EPS of $0.89 Revs were also up 7% Y/Y, or 2% excluding currency fluctuations.
Jim Cramer is giving the footwear company a Buy rating. He says that the company is a great long-term growth story, and dominates that global footwear market. The company is also a solid global play, as only 43% of sales come from North America.
The stock is up 55% from its recent lows, lagging its competitors, but with more room to advance.
One key point from Cramer is that he says this is one of the first quarters that earnings came from true sales growth, and not just layoffs and cost cuts. He notes that Nike does its best during times of true accelerated earnings growth.
Inventory is another driving Nike's growth. Nike's inventory is down 12% from levels one year ago.
Nike trades for about 17x FY11 EPS estimates, richer than rivals Deckers (NASDAQ: DECK) and Skechers USA (NYSE: SKX), but Cramer believes that it's worth it, since it is still King of the Hill.
[Editor's Note: Nike also pays a $0.27 quarterly dividend, yielding 1.5% per year. Neither Decker's nor Sketcher's offers a dividend.]
Jim Cramer is giving the footwear company a Buy rating. He says that the company is a great long-term growth story, and dominates that global footwear market. The company is also a solid global play, as only 43% of sales come from North America.
The stock is up 55% from its recent lows, lagging its competitors, but with more room to advance.
One key point from Cramer is that he says this is one of the first quarters that earnings came from true sales growth, and not just layoffs and cost cuts. He notes that Nike does its best during times of true accelerated earnings growth.
Inventory is another driving Nike's growth. Nike's inventory is down 12% from levels one year ago.
Nike trades for about 17x FY11 EPS estimates, richer than rivals Deckers (NASDAQ: DECK) and Skechers USA (NYSE: SKX), but Cramer believes that it's worth it, since it is still King of the Hill.
[Editor's Note: Nike also pays a $0.27 quarterly dividend, yielding 1.5% per year. Neither Decker's nor Sketcher's offers a dividend.]
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