Destocking in sight đź‘ź
28 June 2022
Nike released last night its results for the past quarter. The inventory level reached a record level: $8.4 billion. That's more than 65 days of sales. 15 days more than in previous years.
After several months of full consumption at high prices, and in parallel with inflation, the consumer will return to his pre-pandemic reflexes: look at the bill before paying and wait for the sales to buy.
As a result, Nike's storage warehouses will have a hard time clearing out.
Nike's solution:
« Transform the business model with new capabilities to evolve at the speed of the consumer ". Translation: implement inventory optimization software.
The real solution that will prevail:
Destocking, through promotions, offers and sales.
A negative point for Nike's margins, which will be "under pressure" next quarter according to CFO Matthew Friend.
Nike is trading at 28x its profit, with a strong presence in a most uncertain Chinese market.
Have a great week,
Pierre
Disclaimer
This presentation is a promotional document. The content of this document is communicated by and is the property of Monocle Asset Management. Monocle Asset Management is a portfolio management company approved by the Autorité des Marchés Financiers under number GP-20000040 and registered with the ORIAS as an insurance broker under number 10058146. No information contained in this document should be construed as having any contractual value. This document is produced for information purposes only. The prospects mentioned are subject to change and do not constitute a commitment or a guarantee. Access to the products and services presented here may be subject to restrictions for certain persons or countries. Tax treatment depends on individual circumstances. The fund mentioned in this document (Monocle Fund SICAV) is authorized for marketing in France and possibly in other countries where the law permits. Before making any investment, it is advisable to check whether the investor is legally entitled to subscribe to the fund. The risks, costs and recommended investment period of the funds presented are described in the KIDD (key investor information documents) and the prospectus, available free of charge from Monocle Asset Management and on the website. The KIDD must be given to the subscribers before the subscription. Past performances are not a reliable indicator of future performances. Monocle Asset Management cannot be held responsible for any decision taken or not taken on the basis of information contained in this document, nor for the use that could be made by a third party. The investor may lose all or part of the amount of capital invested, as the funds are not capital guaranteed.
To unsubscribe or for any information request, you can email us at monocle@monocle.lu
