NIKE, Inc. (NKE) Intrinsic Value & DCF Valuation
Apparel - Footwear & Accessories · NYSE
Current Price
$34.36
Intrinsic Value
$27.78
-23.7% margin of safety
What Is NIKE, Inc.'s Intrinsic Value?
As of 2026-10-07, the base-case DCF model estimates the intrinsic value of NIKE, Inc. (NKE) at $27.78 per share, compared with a market price of $34.36, a margin of safety of -23.7%. The base case assumes 0.9% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $22.85 to $33.44. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is NIKE, Inc. (NKE) Undervalued?
At the current price of $34.36, NKE trades above the base-case intrinsic value estimate by a meaningful margin. By this model the stock looks expensive, though faster growth than assumed would change the picture.
COMPETITIVE MOAT
↑Brand Equity and Consumer Loyalty
Nike's iconic brand commands immense global recognition and aspirational appeal. This fosters strong consumer loyalty, allowing for premium pricing and repeat purchases.
↑Scale and Distribution Network
Nike's vast global scale provides significant manufacturing and sourcing advantages. Its extensive distribution network ensures broad product availability and market penetration.
↑Product Innovation and Design
Continuous investment in research and development fuels Nike's reputation for innovative product design. This drives demand and maintains a competitive edge in performance and style.
INVESTMENT RISKS
↓Geopolitical and Economic Volatility
Global economic downturns and geopolitical instability can negatively impact consumer spending on discretionary items like athletic apparel and footwear. Supply chain disruptions are also a concern.
↓Supply Chain Vulnerabilities
Reliance on global manufacturing and complex supply chains exposes Nike to risks from labor disputes, natural disasters, and trade policy changes. This can impact production and delivery.
↓Brand Reputation and Social Issues
Controversies related to labor practices, marketing campaigns, or social stances can damage Nike's brand image and alienate consumer segments. This requires careful management of public perception.
Base case
NKE base case valuation
Intrinsic Value
$27.78
Margin of safety
-23.7%
Expected annual return
-4.2%
Base case assumptions: 0.9% annual growth, 10.0% discount rate, 24.16x exit multiple, 5 year projection. Data as of 2026-10-07.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the NKE valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for NIKE, Inc. respond.
Open DCF Calculator for NKECompany Overview
NIKE, Inc., through its various subsidiaries, operates as a global enterprise focused on the design, development, marketing, and sale of athletic footwear, apparel, equipment, and accessories for all ages and genders. Beyond its primary offerings, the company provides a range of athletic and casual footwear, clothing, and accessories under the notable Jumpman trademark. It also distributes a variety of casual sneakers, apparel, and accessories, featuring well-known brands like Converse, Chuck Taylor, All Star, One Star, Star Chevron, and Jack Purcell. Under the NIKE brand itself, the company supplies a comprehensive line of performance sports gear and accessories, such as bags, socks, sports balls, eyewear, timepieces, digital devices, bats, gloves, and protective equipment. Additionally, NIKE sells various plastic products to other manufacturers. The company also markets sportswear adorned with licensed logos from college and professional sports teams and leagues. Furthermore, it engages in licensing arrangements, allowing unaffiliated parties to manufacture and sell apparel, digital devices, applications, and other sports equipment under NIKE-owned trademarks. Its extensive product catalog reaches consumers globally through diverse channels, including specialized footwear, sporting goods, athletic specialty, department, skate, tennis, and golf stores. Distribution occurs via NIKE's proprietary retail outlets, digital e-commerce platforms, independent distributors, authorized licensees, and sales representatives. Founded in 1964, the company was originally named Blue Ribbon Sports, Inc., before officially becoming NIKE, Inc. in 1971, and maintains its corporate headquarters in Beaverton, Oregon.
Financial Metrics — NKE Stock Valuation Data
Revenue/Share (TTM)
$30.93
FCF/Share (TTM)
$1.42
ROIC (TTM)
10.3%
ROE (TTM)
21.2%
P/FCF
24.2x
EV/EBITDA
12.5x
FCF Yield
4.14%
Debt/Equity
0.73x
Based on trailing twelve-month data, NKE shows a free cash flow per share of $1.42 and a ROIC of 10.3%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 24.2x and FCF yield of 4.14% are important context metrics when evaluating NKE's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of NKE?
NIKE, Inc. currently generates $1.42 in free cash flow per share. At the current price of $34.36, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is NKE undervalued?
NKE trades at a P/FCF ratio of 24.2x with a free cash flow yield of 4.14%. This P/FCF is in a moderate range. However, whether NKE is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value NKE stock using DCF?
To perform a DCF valuation on NIKE, Inc.: (1) Start with the trailing free cash flow per share ($1.42) as the base, (2) project future FCF growth over 5-10 years based on Apparel - Footwear & Accessories industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting NKE's risk profile — with a debt-to-equity of 0.73x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to NKE?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For NIKE, Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Apparel - Footwear & Accessories trends, then discounting those amounts to today's dollars. NKE's ROIC of 10.3% shows moderate capital returns.
How does WACC affect NKE stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For NKE, with a debt-to-equity ratio of 0.73x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 12.5x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See NKE PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Consumer Cyclical valuationsDCF and P/E value NKE with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-10-07. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.