NIKE, INC.: Executive Summary Financial Statement Ratios

According to Nike’s SIC number (3021), the company is classified in the “rubber and plastic footwear” industry. Relying upon this information Mergent Online identified the following American companies as competitors to Nike:

• Columbia Sportswear Company Annual Revenue $ 1,483,524,000
• Deckers Outdoor Corporation Annual Revenue $ 1,000,989,000
• Crocs, Inc. Annual Revenue $ 789,695,000
• Bakers Footwear Group Annual Revenue $ 185,625,844
• LaCrosse Footwear, Inc. Annual Revenue $ 150,542,000
• PC Group, Inc. Annual Revenue $ 44,989,046

With 2010 annual revenue of $19,014,000,000, Nike’s revenue was substantially greater than the …show more content…

0.23 0.18 0.29 0.22 0.04 0.04
Deckers Outdoor Corp. 0.19 0.18 0.23 0.22 0.01 0.01
Crocs Inc 0.32 0.30 0.46 0.42 0.09 0.12

Adidas’s total debt to assets ratio is the highest with over 50% of their assets being financed by borrowing. This is supported again by the debt to equity ratio that shows the amount of funds coming from debt instead of stockholders investments. Adidas has extensively expanded a distribution center in SC over the past few years and it could be concluded that the financing for the expansion has resulted in the increased numbers. Nike has financed only 32% of their assets through debt in 2010. Nike’s long term debt to equity is low. With a low long term debt to equity ratio and good liquidity ratios, an investor should have no qualms about investing in the company.

To make an investment more appealing to investors is the analysis of the stock value:

05/18/11 Market Price 2010 PE Ratio EPS Diluted EPS Dividend Dividend Yield
NIKE, Inc 85.35 20.1639 4.31 4.21 $ 1.16 1.3665
Adidas AG 51.32 n/a 2.71 2.71 $0.40 1.0874
Columbia Sportswear Co. 66.62 29.2257 2.39 2.36 $