Why Nike is a Buy Now and Forever


In search of the next great investment, I found myself looking at Nike (NYSE:NKE) as possible investment. I haven’t considered Nike as a realistic investment earlier in my investing career due to a lack of capital. However, now that I have a little capital, it time to take a closer look at Nike and why it is a great company to Buy. My investment thesis on why Nike is a buy goes back to when I was in the 2nd grade and I owned my first Michael Jordan’s Jersey. At the time, I did not know much about Nike or what the company did. All I knew was basketball and Michael Jordan was a great player. As I grew up, I owned various shoes from Adidas to Vans. The first time I thought Nike was a great company was when I was camping out at Finishline in 2006 for a new pair of Jordan’s with my friend. To see the great heights people went through for Jordan was astonishing. It showed that Jordan Brand was strong that hundred of people were willing to wait in a long line to buy a pair. Flash forward to today and again, I looked at Nike as a company that does not plan to slow down or give market shares to any competitors. Why was it considered it a great company? Here was my perspectives as a consumer.


Brand Power:

In the latest 2016 ranking by brand consultancy Millward Brown, Nike was ranked 24th on the list. The report can be found here. Nike was ranked higher than Home Depot (NYSE:HD), Walmart (NYSE:WMT), and American Express (NYSE:AXP). That meant to me that the company was very appealing to consumer globally. Also, if you just look around in your daily life, you will not find it hard to spot a Nike product. When I go to work, I see coworkers wearing Nike. When I go on Snapchat or Instagram, I see my friends and/or celebrities promoting Nike. Nike has a tremendous amount of free marketing by its fan base and consumers. A lot of professional athletics out there are very loyal to the brand even though they are not sponsored by them. For an example, recently James Harden of the Houston Rockets signed a 200 million dollars shoe contract with Adidas but was found wearing Nike at social events as reported by TMZ. This was obviously an embarrassment to Adidas and it showed how much Brand loyalty paid a huge role in market dominance.

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