by winston » Thu Feb 08, 2024 7:34 pm
vested
Stocks That Could Create Lasting Generational Wealth
by Justin Pope
Nike is most famous for its sneakers. It also sells clothing and manufactures jerseys for North America's three largest professional sports leagues: the National Football League, the National Basketball Association and Major League Baseball.
There isn't much about a shoe that another company can't copy. However, you can't mimic Nike's two biggest advantages: brand power and deep pockets.
Nike is generating more than $6 billion in annual free cash flow, over four times its closest competitor, Adidas. That means competitors can't outbid Nike for the sporting world's brightest stars.
And with a $150 billion market cap today, it's unlikely investors have to worry about Nike being acquired.
Nike's brand stands on its own, and even playing hypotheticals, Nike is too big at this point for most companies to afford. The swoosh has worldwide appeal, setting Nike up for long-term growth as emerging markets mature. Those consumers who have watched LeBron James or other famous Nike athletes growing up will gravitate toward the brand when they set out to buy new sneakers.
Source: The Motley Fool
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