Microsoft envisions the Xbox at the center of the living room, and Nike is being cemented inside of this vision. With an estimated 76 million Xbox 360 consoles around the world and about a third of them being hooked up with the Kinect, Nike has an inroad into digital fitness training with heavy support from one of the most popular gaming consoles available.
3.) It all comes down to the fundamentals…
Nike has great fundamentals. The company also has a strong balance sheet, good free cash flow, and good prospects going forward. The stock offers a good mix of growth and increasing dividend payouts. Valuation wise, with a P/E almost touching 25 and a forward P/E of about 18, the stock is a little pricey, however.
The bottom line
Nike is dominating and is transitioning into the digital world nicely. The move into digital doesn’t seem like a “deworsifying” scenario, but compliments the company– with Xbox integration seemingly giving them a head start over competitors such as Under Armour as well. The company has a ridiculously strong catalog of shoe designs that are popular with cult-like collectors that can be released and re-released over-and-over again in different color ways. The company also tends to attract the best-of-the-best when it comes to sponsoring athletes. On any pullback the company would make a great long-term buy, as Nike will continue to dominate its competitors and remain a global juggernaut. The company will also more than likely continue to grow and raise dividends– in turn rewarding shareholders nicely.
The article 3 Reasons Why I Love Nike (And You Should Too) originally appeared on Fool.com and is written by Joseph Harry.
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