Nike

I set up a limit order to purchase Nike at $53 per share today and just before close the price of Nike dipped down below $53. Unfortunately Apple and Microsoft didn't get down to the levels where I had set my limit orders.

Yearly earnings per share for Nike since 99 (ending in May of each year) have been as follows:
0.78
1.04
1.08
1.23
1.38
1.75
2.24
2.64
2.93
3.74

While Nike's earnings have grown 500% the stock price has barely doubled in that time. Nike carries long term debt in the amount of $441 million while last year alone their net income was $1.8 billion. This is important because if the company were to face some lean years in sales and their earnings were to take a hit they would be in a very good position to pay off their debt and avoid the pitfalls we are now seeing with the big 3 automakers. Apple and Microsoft carry no long term debt, but their current liabilities are through the roof.

Nike is currently trading at 15 times earnings which is right where I like to purchase most stocks. I tend to pay more for technology companies, but not very often.

The numbers tell the story, but I don't like to buy stocks based solely on numbers. I want a company that is going to be around tomorrow and going to produce consistent returns in the future. Nike isn't going anywhere. It will definitely keep growing because it sells a product that people keep using. Even if production costs increase the Nike brand enables the company to increase prices to offset any increased expenditures. Shoes keep going up in price and people keep buying them.

Now if Lebron will just go to the Knicks....