Nike Plunges After Q4 Earnings

Nike

released its fiscal fourth-quarter earnings results after the closing bell on Thursday afternoon. The company reported net income of $549 million or $1.17 per share, versus $594 million or $1.24 per share, in last year's corresponding quarter. This compared to analysts' consensus EPS estimates of $1.37. Revenues in the period were $6.47 billion, up from $5.77 billion last year. This also missed Wall Street consensus estimates of $6.51 billion. Worldwide future orders for Nike brand athletic footwear and apparel, scheduled for delivery from June through November, rose 7% from last year. During Thursday's trading session, Nike shares have lost around 10% and were last trading just above the $87.00 level. Analysts at Citigroup acknowledged the weakness in the quarter, but reiterated their view that the long-term thesis for the stock remains intact. They wrote, "There is no question Nike's earnings and subsequent guidance for FY13 was disappointing. We saw futures slow (most notably China), margins under pressure (again) and guidance for FY13 was lower than consensus." Nevertheless, Citi said that Nike remains a "high quality growth story to own." Citi did lower its price target on the stock, however, from $123 to $98.