Sportswear retailer, Nike, is beginning to get the attention of stock investors with the stellar performance of its stocks in recent times. Nike stock trades on the Dow Jones Industrial Average and since 2013 shareholders have been rewarded with generous quarterly dividends. The latest dividend offer, which was just announced on Thursday, is 32 cents per share which is a whopping 14% increase over its previous quarterly dividend!
Over the last decade, Nike has reduced its share count average by 2% on an annual basis. However, the retailer has just unveiled its 2 for 1 stock split which will double the number of shares outstanding and essentially halve the share price. The new stock price is expected to take effect on December 24th. The intention is to apparently make Nike stocks more affordable for investors and will facilitate strong levels of investment. The 2 for 1 stock split sends a strong signal to investors that the company’s fundamentals are strong and, as expected, Nike’s share price has begun to soar since the announcements were made, registering a 4% increase for this week.
At the close of trading on Thursday, Nike shares were at $125.78 which represents a 31% increase since the start of this year and a 33% increase since January 2nd last year. Following the close of trading on Thursday, Nike has also announced its intention to launch a $12 billion stock buyback program. The buyback is valid for the next four years and applies to the company’s B class of shares. A buyback generally increases shareholder value and is good news for investors.
Nike is the world’s top seller in the market for sneakers and maintains a strong position over rivals Adidas, Under Armour Inc and Skechers Inc. With improving fundamentals Nike stocks should continue to perform well.