NIKE PRESENTS LONG-TERM VISION AT INVESTOR DAY

In 2015, Nike (NKE) Chief Executive Mark Parker, a Phil Knight disciple, projected company revenue would hit $50 billion/year by 2020. Fast forward to Wednesday’s investor day and the $50 billion mark no longer appears realistic. Speaking in broad strokes, Parker presented the company’s long-term vision; offering up padded stats that project 50% of future sales growth coming from “innovation”, 75% of future revenue growth coming from “international” expansion (read: China) and “huge opportunities” in women’s footwear. NKE has even taken a page out of Silicon Valley’s playbook, disrupting the company’s long-time sales model in hopes that partnerships with Amazon and Instagram will help the company reach Parker’s goal.

Howie Long-Short: Parker’s $50 billion revenue target was always ambitious, considering NKE would have had to grow revenue 63% (from the time of his comment) to achieve it. 2015 was an outlier year, with record growth in both the apparel and footwear industries. Parker expected the trend would continue for the balance of the decade, but that hasn’t been the case. Sales growth slowed to just .1% over the last 90 days. I’m confident in saying, $50 billion by 2020 simply isn’t going to happen.

Fan Marino: Forbes released their list of the 40 most valuable brands in sports. Nike finished first with an estimated value of $29.6 billion, up 9.6% from their ’16 valuations. ESPN (DIS) ($15.8 billion, -4.2%), Adidas (ADDYY) ($7.9 billion, +12.9%), Sky Sports (SKYAY) ($5.5 billion, +10%) and Under Armour (UAA) ($4.4 billion, -20%) rounded out the Top 5.

Editor Note: The summary for this story was written by our friends at The Water Coolest. Check out TheWaterCoolest.com for the latest market news and professional advice.

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Author: John Wall Street

At the intersection of sports & finance.

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