Nike declines most in seven months
NEW YORK: Nike Inc., the world's largest maker of athletic shoes, dropped the most in 21 months after reporting orders that fell short of some analysts' estimates, Bloomberg reported.
Nike fell $5.35, or 5.8 percent, to $86.95 at 4:04 p.m. in New York Stock Exchange composite trading, the largest drop since March 5, 2009. The shares closed yesterday before the report at $92.30, the highest price since its initial public offering in 1980.
Orders for the Nike brand for December to April rose 11 percent to $7.7 billion, excluding currency fluctuations, from a year ago, the Beaverton, Oregon-based company said in a statement yesterday. That missed the 11.6 percent gain projected by an average of five analysts surveyed by Bloomberg. Orders gained 13 percent from September through January. "A lot of people who love this stock hoped for something better," said Chris Svezia, an analyst for Susquehanna Financial Group in New York. "At a 52-week high, they expected this company to knock the cover off the ball." Investors are concerned that orders in China and emerging markets decelerated from the previous period, Sam Poser, an analyst for Sterne, Agee & Leach Inc. in New York, said yesterday in an interview on Bloomberg Television.
Orders for China gained 14 percent, compared with an advance of 23 percent in the prior period, while emerging markets increased 15 percent, down from a 24 percent. The growth in orders was affected by comparisons to last year when the World Cup drove purchases in those regions, Nike Chief Financial Officer Donald Blair said yesterday in a conference call with analysts. Nike reported second-quarter net income increased 22 percent to $457 million, or 94 cents a share, in the period ended Nov. 30, from $375.4 million, or 77 cents a year earlier. -PB News