Strong topline and gross margin, PT $85
Nike reported Q418 EPS of $0.69 ahead of consensus and our estimate of $0.64. Topline and gross margin both beat comfortably, with a further 2c from lower tax. The company also raised its revenue and gross margin guidance for FY19 from the previous preliminary outlook, based on stronger fundamental trends. We are putting through slightly higher gross margin expansion, both for FY19 and the next several years, and our price target is now $85. Nike continues to be one of the highest quality franchises in our universe and we remain Overweight.NIKE is engaged in the design, development and marketing and selling of athletic footwear, apparel, equipment, accessories and services. The company focuses its NIKE Brand product offerings in Running, NIKE Basketball, the Jordan Brand, Football (Soccer), Training and Sportswear categories. The company markets products designed for kids, as well as for other athletic and recreational uses such as American football, baseball, cricket, golf, lacrosse, tennis, walking, and other outdoor activities. The company has license agreements that permit unaffiliated parties to manufacture and sell, using the company-owned trademarks, certain apparel, digital devices and applications and other equipment designed for sports activities.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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