Nike Beats Earnings 

Shares in Nike surged higher yesterday and are trading around 4% higher ahead of the US open today after the company posted better than expected earnings. For Q3 FY 2023, Nike posted EPS of $0.79, well above the $0.55 the market was looking for. Additionally, revenues came in at $12.39 billion, again surpassing Wall Street forecasts for a $11.482 billion figure. This marks the company’s 11th straight quarter of earnings growth and has seen shares surging higher by around 8% (pre-market, as of writing) from Monday’s closing price.

Inventories Reducing 

Alongside the headline data, investors were notably buoyed by news that the company is starting to trim excess inventories. Growing inventories level had been a key concern over recent quarters. While still 43% highs year on year, at $8.9 billion, inventories were down sharply from the prior quarter’s $9.3 billion level. Looking ahead, the company noted an optimistic outlook though said it would be carefully monitoring consumer confidence. Still, Nike forecasts end of year growth to hit the high single digit level, up from the mid-single digit level forecast at the last earnings update.

Technical Views

Nike

The rally in Nike shares off the 115.77 level has seen the market breaking out above bear channel from last year’s highs. Price has now broken above the 122.20 level and while above here the focus is on a continuation higher towards the 130.92 level in line with bullish momentum studies readings.