Nike: Smashing Earnings; How To Play It

Jun. 28, 2021 12:49 PM ETNIKE, Inc. (NKE) Stock3 Comments
Damon Verial profile picture
Damon Verial
18.11K Followers

Summary

  • Nike was an obvious long earnings trade for me due to a number of factors, perhaps most important of which was the overly pessimistic analyst estimates.
  • Nike smashed earnings, showing not only that pessimism on the Chinese market was unjustified but that the company is still growing in North America.
  • Management sentiment is more positive than it has been in the past several quarters, pointing to excess returns over the coming months.
  • I predict Nike to trade higher in the next few months and propose an options trade for post-earnings Nike.

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Nike (NYSE:NKE) is rallying on earnings, as I expected. On June 22nd, I recommended my subscribers go long on this stock before earnings for a number of reasons. Today, I want to review

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This article was written by

Damon Verial profile picture
18.11K Followers
Damon Verial is a statistical analyst who uses his skills to research stocks, options, and investment strategies. In addition, Damon is the writer of Copy My Trades, a trade-alert, subscription-based newsletter, available at his personal website. . Damon makes his living as a gap trader, an earnings trader, and an interday trader. In his free time, he writes for Seeking Alpha, where he focuses on seasonal investing, market timing, and earnings analyses. . Damon has written several successful stock analysis algorithms, including algorithms that can predict gap closure, intraday patterns, and news overreactions. They will soon be publically available for subscribers. .Damon’s undergraduate education was in statistics and mathematics at the University of Washington; his graduate education was in psychology at National Taiwan University. He currently lives in Fukuoka, Japan.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in NKE over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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