Nike to report fiscal second-quarter results

PORTLAND, Ore.—Nike Inc. reports earnings for its fiscal second quarter on Wednesday after the market closes. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: Nike leaders have said that no company is immune from the current economic crisis, but the athletic apparel and footwear maker has hardly broken its stride.

Nike has been one of the most resilient companies during the economic downturn, benefiting from strong growth overseas and the currency benefits of a weak dollar. However, a stronger dollar and marked drop in consumer spending around the globe during the quarter, particularly its massive domestic market, may slow the traditional market leader.

Shares of Beaverton, Ore.-based Nike hit their 52-week low on Nov. 20 at $42.68

During the quarter, Nike announced a four-year, $5 billion buyback program and announced a 9 percent increase in its dividend payments. The company had some product issues as well, announcing that it was getting out of the elite swimwear market, following intense competition from Speedo, and announced that it was pulling its popular Nike+ SportBand training tool just before the holidays because of faults in the product.

BY THE NUMBERS: Analysts polled by Thomson Reuters, on average, expect a profit of 79 cents per share on sales of $4.73 billion. The company did not provide profit guidance for the quarter but previously said it expects its revenue for the quarter to range from $4.64 to $4.73 billion.

ANALYST TAKE: Analysts are mixed on their take on Nike's quarter.

Stifel Nicolaus analysts wrote in a research note ahead of the report that Nike will show deceleration in a difficult global economy and recession, magnified by a sharp reversal in currency benefit. Although they did write that Nike's strengths remain the same, in its global brand power, technology leadership, supply chain expertise, healthy balance sheet, and strong cash flow. Stifel Nicolaus has a "hold" rating on Nike shares.

Susquehanna Financial Group analyst John Shanley, who has a "positive" rating on Nike, wrote that despite the near-term pressures, the company continues to show a strong balance sheet and significant long-term growth potential.

WHAT'S AHEAD: Nike will continue to face macroeconomic headwinds such as declining consumer spending, uncertain financial markets in the U.S. and abroad as well as increased costs for outsourcing overseas.

STOCK PERFORMANCE: Nike shares have fallen nearly 13 percent during the quarter.