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Strategies & Market Trends : Value Investing
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To: S. maltophilia who wrote (78665)12/5/2025 2:19:18 PM
From: Sean Collett1 Recommendation

Recommended By
S. maltophilia

   of 78747
 
RE: NKE

I am not sure what the growth story for them is. A big star with LeBron is close to retiring and if you watch him play it's real close. I am not sure how much pull a LeBron shoe has if he's not playing anymore - he's not Jordan from a pure brand perspective. Durant is 37. Giannis isn't as big as either Jordan or LeBron and Booker is not even in the same discussion as Giannis. Zion is a dud given his weight and health issues and we will see with Tatum and the injury he has. Luka is their biggest star right now but I just am not sure he's a shoe mover.

EBITDA had been growing since 2020 but the recent decline now has 2025 lower than 2019 EBITDA! Valuation can be rather subjective depending on growth forecasts but even with a 10% discount rate and assuming share growth compounds at -2% over next five years and 1% earnings growth I would have them at ~$46/s which is much lower than the price they are at today. If earnings were growing then this is a different story but the fact they are not hurts the valuation a lot.

I would agree this one is a growth story and with tougher comp from organizations like $DECK in the running space I think $NKE isn't a clear growth investment.

Happy investing,

Sean
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