Valuation snapshot: NIKE, Inc. (NKE)

Price $38.45 and market cap $57.1B, as of 29 Oct 2026 intraday 1. Nike's fiscal year ends 31 May.

Executive summary

Yes, Nike is expensive on what it earns today, even though the stock is down 39.7% year to date and near a 13-year low 1 2. At about 30x fiscal 2027 consensus EPS and about 18x forward EV/EBITDA, it trades at roughly double the sportswear peer median and in line with or above its own five-year average. On today's earnings it screens rich. The price only makes sense if the margin rebuild from the Pace cost programme delivers.

Multiple cross-check

How these figures were built. "Now" multiples come from the company tearsheet 1. The forward P/E is the $38.45 price divided by consensus EPS of $1.27 for FY2027 (30 analysts) and $1.50 for FY2028 (31 analysts) 1. Forward EV/EBITDA uses an EV of about $56.5B: the current market cap less about $0.5B of net cash (cash and short-term investments of $8.37B against debt of $7.89B 3), divided by FY2027 consensus EBITDA of $3.18B 1. The peer column uses CrispIdea's 14 Oct 2026 table, struck at a $34.36 share price: Adidas, Deckers, On, Lululemon, VF, ANTA, Li Ning, ASICS, Puma and Under Armour 3. On 21 Sep 2026, before the guidance cut, Nike traded at 20.7x forward earnings against 10.5x for Deckers, 14.3x for On and 11.5x for Adidas 4.

Why P/E and EV/EBITDA. Nike is a mature, branded consumer company with positive but depressed earnings. Earnings multiples are the right anchor. EV/Sales (1.3x TTM against 4.1x in FY2022 1) mostly shows the margin collapse, not cheapness.

What's priced in

• Revenue growth: consensus expects no top-line recovery for three years. Revenue falls from $46.4B in FY2026 to $42.8B in FY2027 (−7.7%), then reaches only $43.0B in FY2028 and $44.1B in FY2029 1. This matches guidance of a high-single-digit decline in FY2027 and adjusted EPS of $1.15–$1.35 2. The multiple does not depend on growth. It depends on margin.
• Margins: this is where the expectations sit. Consensus EBITDA rises from $3.18B in FY2027 to $6.20B in FY2031, which takes the EBITDA margin from about 7.4% to about 13.4% 1. For reference, the operating margin was 14.3% in FY2022 and 8.2% in FY2026 1, and gross margin averaged 45.0% over the past decade against 42.9% in FY2026 5. On FY2031 consensus EPS of $3.00 (9 analysts), today's price is about 12.8x 1. In other words, buyers today pay a full multiple for earnings that are five years out and depend on a margin rebuild. The rebuild rests on the Pace programme, which targets $2.5B of savings by FY2031 with "maximum savings" in FY2029–FY2030 6.
• Risk: the stock has de-rated on price but not on earnings. Forward EPS fell faster than the share price, so the forward P/E went up, from 20.7x on 21 Sep to about 30x now 4. The market is still pricing Nike as a premium brand in a trough, not as an ex-growth company. Sell-side targets agree: the consensus target is $37.15 and the median $35, both below the current price. Of 73 analysts, 34 rate the stock Buy or Strong Buy, 31 Hold and 8 Sell 1.

Key drivers to monitor

1. Greater China. Revenue fell 26% in fiscal Q1 2027 (quarter to Aug 2026), and management expects the decline to worsen 6 5. Nike's largest Chinese retail partner says October sales weakened again and that Nike sales on its online platform end in early 2027 7. A deeper China reset would push the FY2028–FY2029 earnings base lower.
2. Gross margin path. Q1 gross margin rose 60bp to 42.8% on lower logistics costs 8. But management expects EBIT to fall faster than revenue for FY2027 because of gross margin pressure, fixed-cost deleverage and higher input costs 6. Each step back toward the 45% ten-year average is the main lever on fair value.
3. Performance vs Sportswear and Jordan. The Performance business ($16B in FY2026) grew high single digits in Q1 9, while management is deliberately shrinking Sportswear, Jordan and China, with the pain likely to "bleed" into FY2028 6. The mix has to turn before revenue does.

Caveats

• Dividend coverage. The quarterly dividend of $0.41 2 is $1.64 a year, about 129% of FY2027 consensus EPS. Free cash flow was $2.18B in FY2026 1, below the roughly $2.4B a year implied by the $0.6B that Nike paid in dividends in Q1 8. The 4.3% yield does not anchor the valuation unless earnings recover.
• Trailing multiples flatter the stock. TTM EV/EBITDA of 13.4x includes quarters that are better than the guided FY2027. Use the forward figures.
• Data gaps. The five-year history is at fiscal year-end prices, not a daily average. The peer multiples come from a third-party table dated 14 Oct 2026, when Nike traded at $34.36, about 11% below today.

Closing (structured): Net assessment: Rich vs setup, because about 30x trough earnings and about 18x forward EV/EBITDA, roughly twice the peer median, already pay for a margin rebuild that management says peaks in FY2029–FY2030. Key risk: the China and Sportswear reset runs deeper or longer than guided, which pushes the FY2028 earnings base down. Next catalyst: fiscal Q2 2027 results on 17 Dec 2026 1, where management has flagged a revenue headwind of about 400bp from lapping prior-year promotions and sell-in 6.

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