Nike has increased its dividend payout for 25 straight years.
Investors can generate a nearly 5% dividend yield while they wait for the company’s fundamentals to improve.
For its fiscal 2027 first quarter (ended Aug. 31), Nike (NYSE: NKE) reported revenue of $11.2 billion. This figure was down 4% year over year and came in below analyst estimates. The consumer discretionary stock felt the pain, adding to its slide, which now puts it 81% off its record set in November 2021 (as of Oct. 5).
But this company might present a very interesting opportunity for income investors. Here's how many Nike shares you'd need to bring in $10,000 in yearly dividends.
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Nike currently pays an annualized dividend of $1.64. This means that investors would need to own about 6,100 shares to generate a $10,000 passive annual income stream.
The dividend payout has climbed for 25 straight years. Before 2026 ends, history suggests that streak will likely rise to 26 consecutive years.
It's also hard not to focus on the current dividend yield, which is just under 5%. That's a sizable income stream for shareholders.
Given Nike's healthy financial position, the dividend payout faces minimal risk of being paused or cut. However, investors will have to be patient if they're waiting for the business to turn things around. Nike's biggest issue might be its struggle with product innovation. This has opened the door for smaller competitors to launch in-demand shoes that consumers are more excited about.
The dividend is compelling, no doubt. But investors should expect Nike's difficulties to continue in the near term.
Before you buy stock in Nike, consider this:
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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nike. The Motley Fool has a disclosure policy.