Nike just reported it’s Q2 2025 earnings…

NKE stock is down over 55% from it’s all-time high. The dividend yield is now the highest in the past decade.

Is it finally time to buy this Dividend Growth Stock?

The Key Story

A Top Dividend Growth Stock On Sale -
Nike Stock Analysis

Nike’s Q2 2025 beat analyst expectations on both revenue and earnings per share, with EPS exceeding forecasts by 20%.

Initially, the market reacted positively, pushing the stock up by about 10% after hours. Yet that enthusiasm quickly faded, and by the end of trading, Nike was down about 0.5%.

What’s going on here?

For starters, Nike’s share price has been declining for about three years, dropping from a high of $177. That’s brought Nike’s dividend yield into historically high territory—over 2%, a level not consistently seen since the Great Financial Crisis.

For dividend growth investors, this might signal an opportunity. Nike has increased its dividend for decades and sports a 10-year dividend growth rate of about 11%. Its payout ratio remains comfortable, suggesting the dividend is sustainable.

High-profile investors are also taking notice. Last quarter, Bill Ackman’s Pershing Square took a sizable position in Nike, making it about 11% of his portfolio.

Why the mixed signals?

Nike is in a transition year.

The company just brought back a longtime executive as CEO and plans to refocus on its sports heritage and product innovation.

However, that means they need to clear out their current inventory.

In the short term, that means lower revenues and margins as it discounts inventory and invests in core categories. Management expects near-term declines in revenue and profitability—hence the market’s caution.

However, long-term prospects look brighter.

A Buying Opportunity?

Nike’s brand strength and history of free cash flow generation position it well for a rebound. Analysts generally remain bullish, with price targets suggesting upside potential once the company regains its footing.

Using a discounted cash flow analysis, Nike’s current trading range appears close to fair value, with a chance for solid long-term gains if the turnaround takes hold.

Nike’s massive historical total returns (over 13,700% since 1990) are a testament to the brand’s staying power.

If you believe in Nike’s long-term vision and commitment to dividends, now could be a time to pay attention.

Still, always do your own research before making any investment decisions.

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— Zach

Disclaimer: Dividend Dividend (Dividend Data LLC) is not a professional financial service. All materials released from Dividend Data (Dividend Data LLC) are for educational and entertainment purposes. Dividend Data (Dividend Data LLC) is not a replacement for a professional's opinion. Contributors to the Dividend Data (Dividend Data LLC) might have equities mentioned in the newsletter