Nike Message Board - Msg: 6888634

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Non-Tech : Nike

NKE 64.59

-1.5%

Jan 15 3:59 PM EST

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To: gringodoc who wrote (2249)	12/18/1998 9:36:00 AM
From: gringodoc	Read Replies (1) of 2403

briefing.com on NKE: 08:55 ****** NIKE INC. (NKE) 42 1/4. Just not doing it. After the close Thursday, leading athletic footwear and apparel maker Nike (NKE) reported second fiscal quarter (Nov) earnings of $0.24 per share. That was a 50% plunge from the $0.48 per share posted in the year-ago second quarter on a revenue drop of 10%. This marks the fourth straight quarter of a year-over-year revenue decline, and this quarter's is the most severe. Making matters worse is the fact that future orders fell 10%. Every region of the world was weak, but the situation in the U.S. is of the greatest concern, where revenues fell 15% and future orders 7%. CEO Knight said "in the short term, we remain cautious on the U.S. market" in part because of the NBA strike (someone has noticed!). The good news is that with even such a poor overall report, NKE still beat Wall Street's expectations by two cents. That may be enough to keep the stock up for day traders, but the fact is that NKE just doesn't have any momentum at this time, and fashions change quickly in this industry. NKE trades at over 38 times trailing earnings, so expectations of an earnings rebound are already partly in the price. Given the risks that exist and the continued weak revenue outlook, NKE stock may well continue in the trading range it has been in for months. The fundamentals are not in place yet for a breakout to the up side.

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