NIKENIKE

History of NIKE Inc.

• Its name is derived from a winged Greek goddess. • “Swoosh” logo designed by Caroline Davidson.• Is now one of the world’s top shoemaker that captures more

than 20% of US athletic market.• Original name of Nike given by Phil was “Blue Ribbon

Sports”.• With an agreement and handshake in 1964, they began

importing Japanese brand Onitsuka Tiger running shoes.• By late 70’s, Nike had moved from $10million to $270million

in sales.• In 1996, revenue increased to $6.74billion. Sales reached

$12billion in 2000.

Footwear

• Running

• Basketball

• Soccer

• Sport-inspired urban shoes

• Children’s Shoes

Also Sells

• Apparels and Accessories

• Athletic Bags

• Offers Apparels for Licensed Sports Team

Sale of Performance Equip. under Nike Brand

• Bags• Socks• Sport Balls• Eyewear• Timepieces• Electronic Devices• Bats• Gloves• Protective Equipments

Provides Licenses to Produce and Sell

• Swimwear

• Cycling Apparel

• Children’s Clothing

• School Supplies

• Electronic Devices

• Eyewear

• Golf Accessories

• Belts

• The company sells its products to retail accounts, through its owned retail stores, and through a mix of independent distributors and licensees, as well as through Internet Web site, nikestore.com

Sales Technique

Subsidiaries

• NIKE inc. has major four subsidiaries which are:ConverseCole Haan HoldingsNike Bauer HockeyHurley International

Major announcements

• February 15, 2008 (Financial Wire) NIKE, Inc.'s (NYSE: NKE) board has declared a quarterly cash dividend of twenty three cents per share on the company's outstanding class A and class B common stock, payable April 1 shareholders of record at the close of business March 10.

• NIKE and Phoenix Suns guard Steve Nash are releasing a new basketball shoe made with manufacturing scraps, called the Nike Trash Talk shoe.

• Feb. 5 (Bloomberg) -- Nike Inc. put its Bauer hockey equipment unit up for sale, having failed to promote the brand.

Comparative Balance Sheet

Acoount Heads 2007 2006 Increase/Decrease % Change

Current Assets 8077 7359 718 9.76%

Total Non current Assets 2612 2511 101 4.02%

Total Assets 10689 9870 819 8.30%

Current Liabilities 2584 2623 -39 -1.49%

Total Non-current Liabilities 1079 961 118 12.28%

Total Liabilities 3663 3584 79 2.20%

Total Equity 7025 6285 740 11.77%

Accounts 2007 2006 Increase/Decrease % Change

Revenue 16326 14954 1372 9.17%

COGS 9165 8368 797 9.52%

Gross Profit 7161 6586 575 8.73%

SG&A Expense 4759 4187 572 13.66%

Depreciationa & Amortization 270 291 -21 -7.22%

Operating Income 2132 2108 24 1.14%

Nonoperating Income 68 32 36 112.50%

Income Before Taxes 2200 2140 60 2.80%

Income Taxes 708 750 -42 -5.60%

Net Income After Taxes 1492 1390 102 7.34%

Comparative Income Statement

Financial Strength

• Current ratio

• Quick Ratio

• Total Debt to Equity Ratio

Overall Financial Strength

Current Ratio (2.32:1) Good

Quick Ratio (3.11:1) Good

Debt to Equity Ratio (0.08) Good

- Analysis of these ratios shows that they are in overall good standing concerning financial strength.

- The company has a relatively low risk of not meeting their short term obligations.

Efficiency

• Receivable Turnover

• Inventory Turnover

• Asset Turnover

Overall Efficiency

Receivable Turnover(6.93:1) Good

Inventory Turnover (4.30:1) Good

Asset Turnover (1.63) Good

- Analysis of these ratios shows that they are in overall good standing concerning the efficiency.

Valuation Ratios

• Price to Earnings Ratio

• Price to Sales Ratio

• Price to Cash Flow Ratio

• Price to Free Cash Flow Ratio

Dividends Ratio Analysis

The higher dividend payout ratio compared to industrial average indicates that the company’s dividend payment ratio is well supported by its earnings.

However, the dividend yield ratio and dividend growth ratio is well below the industrial average.

2007 2006 2005

2004 2003 2002

Dividends per Share - Common Stock Primary Issue 

 0.71   0.59   0.47   0.37   0.27   0.24 

Views

• In our view, Nike will increase its sales growth rate and its profit percent. The company might as well start new products.

• The company is increasing its sales as well as revenue. So, it is profitable for company to expand its business as much as possible.

Citations

• Annual Report 2006,2007.

• http://www.finance.google.com/finance

• http://www.hoovers.com

• http://www.nikebiz.com

• http://investing.businessweek.com/

• http://shoes.about.com