If You'd Invested $10,000 in Nike a Decade Ago, Here's How Much You'd Have Today (And It's Not Pretty)

As recently as a few years ago, few stocks would have felt safer to buy and hold a decade ago than Nike (NYSE: NKE). It owned its category, carried one of the most recognized brands on earth, and rewarded shareholders with a steadily rising dividend. So here is a figure that should give any long-term investor pause: $10,000 invested in the sportswear giant 10 years ago, with every dividend reinvested, would be worth only about $9,000 as of this writing. You would have less than you started with.

Put that same $10,000 into a simple S&P 500 index fund over the same stretch, and you would be sitting on about $41,700 today -- more than four times your money.

Nike stock has quietly turned into one of the market's more disappointing blue chips. And how that happened says a lot about whether today's beaten-down price near $44 is the opportunity it appears to be.

Image source: Nike.

A lost decade for the stock

Today, the stock trades near its 52-week low and has likely burned a lot of investors. Shares recently traded around $44 -- below where they changed hands a decade ago, and down from a 52-week high above $80. Even reinvesting every dividend along the way still wasn't enough to pull the position out of the hole. Over the past 10 years, Nike stock has produced a slightly negative total return with dividends included, while the S&P 500 more than quadrupled the same money.

What makes that so surprising is that the business didn't fall apart the way the stock did -- at least when you look at it from an outsider's perspective. Nike is still one of the largest athletic footwear and apparel companies in the world, and for much of the decade, its revenue and profits climbed.

One issue behind the stock's poor performance was the price investors paid for that growth. Ten years ago, the stock carried a rich valuation multiple -- the premium the market hands a company it assumes will compound for years without missing a step.

But when the misses came, that premium unwound.

Revenue peaked near $51 billion in fiscal 2024, then fell about 10% to $46.3 billion in fiscal 2025. In fiscal 2026, the year that ended May 31, revenue was essentially flat at $46.4 billion. Greater China, once a dependable growth engine, has been shrinking, and higher-margin direct-to-consumer sales have fallen as well, nudging the profit mix (a bigger share of sales going to lower-margin channels) the wrong way. A business doesn't have to break for its stock to be a poor investment. It just has to disappoint expectations that were set too high.

Is $44 finally cheap enough?

So does a decade of underperformance and a price near $44 finally make Nike a value stock worth buying? Not so fast.

On the surface, the stock does look cheap. It trades at about 21 times earnings and yields about 3.7% -- a generous payout from a company that has raised its dividend for 24 straight years. But valuation a second look, as the forward view isn't any cheaper. Indeed, it's worse. Nike's forward price-to-earnings ratio -- its price measured against expected earnings over the next year -- sits at around 25. For a company whose revenue just went flat, paying about 25 times next year's expected earnings is a lot.

Further, the dividend that makes the stock look like an income play takes up about 78% of Nike's reported earnings, leaving little cushion for its 3.7% yield.

All of this shows that even a dominant, dividend-paying household name can be a poor investment if you overpay for it -- and for a decade, that is what Nike was. Today's lower price fixes part of that problem. But not all of it. Personally, I'd want to see revenue actually reaccelerate, and the mix tilt back toward those higher-margin direct sales before I'd treat $44 as a good entry point into the stock.

Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Nike. The Motley Fool has a disclosure policy.