Why Is Everyone Talking About Nike Stock?
The pandemic that swept across the world led to the unprecedented closure of numerous physical retail shops, and food and beverage outlets. Nike (NYSE: NKE) was no exception, as it started closing its stores in China in January when the outbreak started there and then moved to progressively shut stores across North America, Asia, and the Middle East from March through April.
These closures have had a detrimental effect on the company's top and bottom lines. For the quarter ended May 31, Nike reported a steep 38% year-over-year fall in revenue, a fall in gross margin from 45.5% to 37.3%, as well as a net loss. Full-year earnings came in 37% lower year on year, though the sports giant managed to declare a higher dividend of $0.955 versus $0.86 a year ago.
Despite this seemingly poor performance, Nike's stock price has rebounded strongly from the lows seen in late March and is even up slightly year to date. The stock continues to flirt with new all-time highs, while the company remains the talk of the town. Why has the company managed to inspire such optimism?
Source Fool.com
