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Let's look for a bottom on Nike (NKE) if the market keeps heading up. They have an uber-cool new shoe called the Air Stab and they just cut a huge deal to open Nike stores in Russia.

The stock is down on poor European sales that will be more than made up for by China's 10% growth and everyone seems to have forgotten about the IPod deal they've cut with Apple (a stock that still seems to be popular). Their Q4 earnings were disappointing as the company was hurt by high oil and labor prices (shoes come from China!) and Adidas' huge sales during the World Cup.

Nonetheless, Nike's sales were up 8% from last year and the company was punished with a 10% drop for missing by a penny as Q4 profits fell 5% (but annual income was up 15%). Because of a stock buyback, EPS was up 18% for the year.

"We set prices in advance, so when you have price increases for oil or labor, it starts to move into our cost structure over time," Don Blair, Nike's chief financial officer.

This is a company earning 100% more per share than 2003 ($2.77) and selling at 2003's high, 20% off the 2004 ($3.51) highs, and 8% below last year's ($4.49) average. After turning in $5.27 a share to close 2006 it's no wonder the executives are a little frustrated with the stock price.

The Nike+ line (with IPod connectivity) was released July 13th and I'm hoping for a weak start to bring the price in a little more (it takes a long time to cross train salespeople and work the bugs out) but I will buy the Oct $80 call options (currently $1.55) on any sign of strength.

NKE 1-yr chart:

Source: Nike's New Sneaks Should Give Some Lift