Nike, Inc. (stylized as NIKE) is a major American company that specializes in athletic footwear and apparel. The company is headquartered near Beaverton, Oregon, in the United States. It holds the title of the world’s largest supplier of athletic shoes and apparel and is a significant manufacturer of sports equipment. In the fiscal year 2022, Nike reported revenue exceeding US$46 billion.
As of 2020, Nike employed 76,700 people globally. In the same year, the brand alone was valued at over $32 billion, making it the most valuable brand in the sports business industry. This marked a significant increase from its 2017 valuation of $29.6 billion. In 2018, Nike secured the 89th position in the Fortune 500 list, which ranks the largest corporations in the United States based on total revenue.
If you’re considering investing in Nike, there are two primary approaches: you can either purchase the stock directly or invest in ETFs. This guide will provide you with all the information you need to get started.
How To Buy Nike Stock
Step 1: Open a Brokerage Account
To invest in Nike stock, you need to open a brokerage account. If you don’t have one, you can check out our curated list of the best online brokers to help you start your search.
Brokers act as the intermediary between you and the stock market. They execute your trades, buying and selling stock on your behalf. There are a wide range of brokerage options available, including full-service brokers and robo-advisors.
When looking for a broker, look for one that offers low fees and investment minimums. If you’re just starting with investing, it’s better to choose a broker with low investment minimums, so you can start investing with a smaller amount of money.
- For long-term retirement savings, consider a Roth for tax advantages. If you’ve held your Roth IRA for at least five years, you can withdraw money without paying taxes or penalties. Unlike a Traditional IRA, a Roth IRA doesn’t have mandatory minimum withdrawals.
- If you’re saving for general goals like building wealth or a home down payment, a taxable investment account might be a more viable option. You can withdraw your money at any time, for any reason, with no tax or penalty from a brokerage account.
Step 2: Research Nike’s Financial Health
An informed investor is a successful investor. Before purchasing Nike stock, you need to perform due dilligence. Here’s what you should do:
Access SEC Filings: Nike, as a publicly traded company, is obligated to file annual and quarterly statements with the U.S. Securities and Exchange Commission (SEC). These documents offer a comprehensive view of the company’s financial health and performance. You can get these reports on Nike’s investor relations page or on SEC.gov.
Check Analyst Reports: Complement your research with analyst reports and insights available through your brokerage’s research resources. These reports often provide expert analysis and market predictions.
Step 3: Decide How Much to Invest
Before you start investing in Nike stock, establish your investment budget. The amount of money you invest is typically determined by the following factors:
- Budget: Make sure your investment doesn’t interfere with your monthly expenses, emergency funds, and retirement savings.
- Nike’s Stock Price: Understand its valuation and decide on the investment amount. Nike‘s stock price fluctuates, but some brokerages allow you to buy fractional shares.
- Investment Strategy: Decide between lump-sum purchase or regular investments using dollar-cost averaging.
- Portfolio Integration: Nike should be a part of a diversified portfolio rather than the entirety of it. You might include it as a “core holding” within your portfolio, alongside other well-established, large-capitalization companies.
Step 4: Execute Your Purchase Order
Once you’re well-informed about Nike and ready to invest, it’s time to place an order for Nike stock. The process is relatively straightforward:
Access Your Brokerage Account: Log in to your brokerage account through the platform’s website or app.
Enter Ticker Symbol: Locate Nike’s ticker symbol, which is “NKE.” Input this symbol into the brokerage’s search bar.
Specify Shares or Dollar Value: Decide whether you want to buy a specific number of shares or a dollar amount worth of shares. Input your desired quantity.
Select Order Type: Depending on the brokerage, you may need to choose between different order types. A market order executes your purchase at the current trading price. A limit order waits until the stock reaches a specific price before executing the purchase.
Since Nike is listed on the New York Stock Exchange (NYSE), you can buy and sell its shares during market hours, which are from 9:30 a.m. to 4:00 p.m. ET, Monday through Friday. Some brokerages may offer extended trading hours.
Step 5: Monitor Your Investment
To effectively manage your investments, set up a routine to review your portfolio’s performance:
- Schedule regular check-ins, whether monthly, quarterly, or annually, to ensure the company continues moving in a positive direction.
- Compare Nike’s performance to broader market benchmarks like the S&P 500 and Dow Jones to gauge how it fares in the broader market context.
- Watch Nike’s financial data in its public filings to assess how the company handles its finances over time.
How To Sell Your Nike Stock
When you’ve decided to sell your Nike shares, follow these steps:
Access Your Brokerage Account: Log in to your brokerage account using your preferred platform, whether it’s a website or a mobile app.
Locate the Stock: Search for Nike’s ticker symbol, “NKE,” within your brokerage platform.
Specify Selling Quantity: Indicate the number of Nike shares you want to sell or the dollar value of shares you intend to divest.
Choose Order Type: Decide on the order type that suits your preferences. A market order will execute the sale immediately at the current market price, while a limit order allows you to set a specific price at which you’re willing to sell.
Confirm and Execute: Double-check your selling details, including the quantity and order type. Once you’re satisfied, confirm the sale to execute the order.
Depending on the profits you’ll gain from selling your Nike shares, it’s better to consult a tax professional. They can guide you on minimizing capital gains taxes and optimizing your financial strategy.
Remember that the stock market operates within specific trading hours, typically from 9:30 a.m. to 4:00 p.m. ET, Monday through Friday. Some brokerages may offer extended trading hours, but keep an eye on market timings when planning your selling strategy.
Other Investment Options
While purchasing individual stocks like Nike can be rewarding, you should consider alternative investment options to diversify your portfolio and manage risk, including:
1. Mutual Funds: Mutual funds pool money from multiple investors to invest in a diversified portfolio of stocks, bonds, or other assets. They offer instant diversification, as your money is spread across various companies and industries. For exposure to Nike along with other investments, you can choose a mutual fund that includes Nike shares.
2. Exchange-Traded Funds (ETFs): Similar to mutual funds, ETFs offer diversification by tracking an index or a sector. However, they trade like individual stocks on stock exchanges. ETFs provide the flexibility of buying and selling throughout the trading day, and their fees are generally lower than those of mutual funds. You can invest in ETFs that include Nike shares as part of a broader investment strategy. Examples include Vanguard Consumer Discretionary ETF (VCR), Consumer Discretionary Select Sector SPDR Fund (XLY), and Roundhill S&P Global Luxury ETF (LUXX), etc.
Learn more: Best Investment Options
