In-Depth Analysis: Nike Stock Valuation and Financial Assessment
VerifiedAdded on 2023/05/29
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This report assesses the stock value of Nike using a discounted cash flow (DCF) model. It begins by introducing Nike's background and its focus on shareholder value. The DCF methodology, involving projecting future cash flows and discounting them to present value, is explained. The free cash flow and weighted average cost of capital (WACC) are calculated, with significant assumptions detailed for cash flow estimation and terminal value. The analysis reveals that Nike's stock is currently overvalued, suggesting investors are overpaying. Despite this, Nike remains a strong brand with solid market positioning, making it a relatively safe investment. The report concludes with a recommendation that Nike should trade its stock at lower valuations, despite its overall strength in the sports apparel and athletic footwear market. Desklib provides this and other solved assignments to aid students in their studies.
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