UBS Analyst Weighs In On Nike's Earnings Beat

Nike Inc NKE reported better than expected fourth-quarter earnings post the market closing on Thursday. Revenue for the quarter rose 5 percent year-over-year to $7.8 billion above analysts' expectations of $7.69 billion, while EPS rose 26 percent to $0.98 topping consensus estimates of $0.83.

Michael Binetti, UBS senior retail analyst, was on CNBC Friday to weigh in on the company's results.

High-Quality Beat

"It was a really good quarter, it was top-line driven, Binetti began. "It's just selling Lite shoes and athletic apparel. So, very high-quality. There's a little bit of noise in the [...] number, but overall it's very, very high-quality beat in the quarter. If there is the big geographies you want to see working -- the United States, Western Europe, China -- they are all firing very, very strongly."

He continued, "The future orders from the [retailers] is very good. If there's any place that they are working on it's some of their emerging markets like Brazil, Mexico. But those seem to be coming around at this point. So, it was a very good report from Nike overall."

Signs Of Improvement In Low Margin Shoes

Binetti was asked if there's concern regarding the company's lower margin shoes (under $100) not selling as well as the higher margin ones. He replied, "That was a big concern last quarter. We thought it will be a several quarter issue. They seem to show some signs of putting better innovation to that channel and seen some sparks of an improvement there. So, they did comment on it last night, it sounded like it was coming around. Not as big of an issue this quarter as we thought it will be [...]."