analysis assumes Nike debt is trading at par – it is not ▪ Equity should be based on market value‚ not book value ▪ Hence total will be based on market cap.‚ not balance sheet ▪ Her debt cost is wrong ▪ She should use the current or projected cost rather than a historic one ▪ i.e. use a Bloomberg terminal (other terminals are available) to research yields on debt of the same credit rating as Nike ▪ It is unlikely Nike has a cost of
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success factors for Nike? Ans. The key success factors for Nike are their exciting marketing strategy‚ product innovation and staying to the mission which is “To bring‚ inspiration and innovation to every athlete in the world.” These are as follows: * Nike established a strong brand name through designing innovative footwear for serious athletes. * Nike’s management has found most significant celebrity support: the right collaboration between celebrity and product. * Nike stayed focused on
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Product: The product that I am choosing to write about is the Nike LunarGlide +3 running shoes. (a) List the typical stages of consumer buying process as discussed in the textbook. The typical stages of consumer buying process include need recognition‚ information search‚ the evaluation of alternatives‚ purchase decision‚ and post purchase behavior. Need recognition occurs when the buyer realizes they have a problem or need which is triggered by either internal or external stimuli. [1] The
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Alexandria Barone English 1101 This Nike advertisement focuses on an obese‚ out of shape young man. It insinuates that greatness can be achieved regardless of where your current baseline resides. For this young man‚ it appears that he is at the infancy stages of a quest for physical fitness. The setting appears to be rural and as he is jogging on a long stretch of desolate road. It is somewhat symbolic of his quest‚ desolate that is. In order for him to achieve his end goal
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we used market value based on the share price of Nike on July 5‚ 2001and number of shares outstanding‚ which resulted in the weights of debt and equity of 10.2% and 89.8% respectively (see Exhibit 2). Cost of Debt: Cost of debt was calculated by Ms. Cohen by finding the historical interest rate of 2.7% and tax rate of 38%. We agree with her estimation of the tax rate of 38%‚ but calculated a cost of debt of 7.17% based on the market price of Nike bonds and finding their yield to maturity (see Exhibit
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within developing countries with particular emphasis on Nike outsourcing history. Summary: Overview/history of company; Nike is one the leading shoe and athletic clothing company in the United States and probably one of the largest in the world. In 1993‚ Nike’s yearly revenue became as large as the NBA‚ NFL‚ and Major League Baseball’s television deals‚ ticket sales‚ and merchandising sales combined. In addition to their phenomenal sales‚ Nike has marketed itself so thoroughly that it has literally
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Nike Case Questions 1. In the United States‚ what is Nike’s: a) Brand image‚ and b) sources of brand equity? a) In the United States‚ Nike’s brand image is built on being a high-performance‚ innovative and aggressive brand. The company associates the brand with top athletes through sponsorships. Since inception‚ Nike has placed performance as a top priority for the brand. Through designing high performance shoes and apparel‚ as well as sponsoring high-profile athletes and teams the brand
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Company Evaluation Project Of Nike Corporation Submitted By: Steven Ritter May 10‚ 2007 Financial Analysis Description of Company History Nike Corporation has become one of the most competitive sports and fitness companies worldwide. Two runners‚ Bill Bowerman and Phil Knight‚ from a small town in Oregon embarked upon the business with a handshake agreement. The enterprise began in January of 1964 with the introduction of Blue Ribbon Sports. In 1966 the handshake between
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(13% today w/ first clean slate in FY14)‚ international presence (step-back before forward)‚ and square footage growth opportunity at Outlets as leases (typically 5 year) come due. In other words‚ growing pains. Boss also started coverage of Nike Inc. (NKE)‚ giving the company a Hold rating and a $100 price target‚ a touch above today’s $99 share price. He touts Nike’s best-in-class position in its category and also points favorably to its balance sheet: With annual free cash flow generation
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NIKE‚ INC.: COST OF CAPITAL On July 5‚ 2001‚ Kimi Ford‚ a portfolio manager at NorthPoint Group‚ a mutual-fund management firm‚ pored over analysts ’ write-ups of Nike‚ Inc.‚ the athletic-shoe manufacturer. Nike ’s share price had declined significantly from the beginning of the year. Ford was considering buying some shares for the fund she managed‚ the NorthPoint Large-Cap Fund‚ which invested mostly in Fortune 500 companies‚ with an emphasis on value investing. Its top holdings
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