Question

NIKE 's Competitor Analysis – 250-500 word summary including a review of a relevant competitor's annual report and calculation of at least three different ratios, and an explanation of which ratios are most important for analyzing the competitive performance between the two companies.

Answer 1

Nilke is an american multinational company who deals in th area of desiging, manufacturing, marketing, and selling of sports footwear, apperal, equipment and other related items. This an brief introduction of NIKE`S. The other competatiors of Nile are Reabok and Adidas. both are giving close competition and market share in this field.

Nike started in 1964 but officially the name Nike Inc. in yera 1971.

nike has an annual revenue of $36.4 billion in the financial year 2018. and market caitalization is about $120.3 billions and 11,000 stores all over the world. number of employees are 73,000.

If we analysis the net income in the current year $1.9 billion and showing decreasing trend 54% compared to financial year 2017. Reebok and Adidas are two close competatiors. Adidas acquired Reebok in the year 2005, for $3.8 billions. After takenover both the companies have strong position in the market to compete with Nike.

Adidas has strong competators in the market with total of $14.3 billions brand valuation and revenue is about 21.218 (Euro) Fourth Quarter revenue increased to $10.2 billion, up of 4% on a reported basis for fiscal year 2019.

Gross profit 2019 nike is $17,474 millions, Net income $4,029 millions, Asset turnover ratio is 1.7x, return on equity ratio is 44.56%, and ROI (return on investment) is 32.12%.

Adidas gross profit 2019 is 12.3 billion euros, showing 52% gross margin, Net income 1.98 billion euros showing 8.36% profir margin. Asset turnover ratio is 1.14 and Receivable turnover is 8.69, Return on Equity is 27.18%.

Nike`s current ratio is 2.6x

Adidas current ratio for 4th quarter is 1.25 this shows good short term financial stgength.

comparing of the two largest and branded company we analysis that Nike is much better in position compared to other competatiors in various part of analysis.

net income also very high, return on investment is too high which shows good financial strength and command over the competators and also provide good quality product in the series and maintained over the year world wide.

Both the companies are strong competators to each other and provide every effort to satisfy the need of the customer in better way.