Nike (NKE) Gets Tripped Up by Rising Costs and Shrinking Margins
PUBLISHED ON: Jul 2, 2012
Shares of footwear giant Nike (NKE: Charts, News) plunged last week after the retailer posted weaker than expected fourth quarter earnings. Nike reported earnings of $1.17 per share on revenue of $6.5 billion.
Analysts had expected Nike to earn $1.37 per share. EPS fell 7.6% while revenue grew 12% from the prior year quarter. Excluding foreign currency fluctuations, revenue rose 14%. A strong top line failed to appease nervous investors, who forced the stock to give up all its gains over the past twelve months. Nikeâ s stock performance now notably trails its stronger, younger athletic wear competitors, such as Under Armour (UA
), Lululemon (LULU
) and Foot Locker FL (FL
). Daily Chart Stock Analysis
Nike attributed its weak bottom line to higher than expected costs and shrinking margins. During the fourth quarter, Nike posted a $24 million restructuring charge from its operations in Western Europe. Nikeâ s â