Nike Inc. (NYSE:NKE)

The investment activity ratios demonstrate generally positive trends over the analyzed period, with some fluctuations. Overall, the company appears to be becoming more efficient in its asset utilization. A notable shift is observed in the latter half of the period, with some ratios beginning to stabilize or slightly decline.

Net Fixed Asset Turnover

The net fixed asset turnover ratio exhibits a consistent upward trend from 7.51 to a peak of 10.25. This indicates increasing efficiency in generating revenue from fixed assets. However, from February 2023 onward, the ratio plateaus and then experiences a slight decline, ending at 9.60. This suggests a potential stabilization of revenue generation relative to fixed asset investment, or potentially slower growth in sales relative to fixed asset increases.

Net Fixed Asset Turnover (Including Operating Lease, Right-of-Use Asset)

Similar to the standard net fixed asset turnover, this ratio also shows an increasing trend, moving from 4.59 to 6.65. The inclusion of operating leases and right-of-use assets results in lower turnover figures, reflecting the increased asset base. The trend mirrors the standard ratio, with a peak in May 2024, followed by a slight decrease to 6.01 in February 2025. This suggests that the impact of lease obligations on asset turnover is consistent with the overall trend in fixed asset utilization.

Total Asset Turnover

The total asset turnover ratio demonstrates a clear upward trajectory, increasing from 1.12 to a high of 1.40 in August 2023. This signifies improved efficiency in utilizing all assets to generate revenue. Following the peak, the ratio experiences a moderate decline, concluding at 1.23. This decrease could be attributed to an increase in total assets without a corresponding increase in revenue, or a slowdown in revenue growth.

Equity Turnover

The equity turnover ratio fluctuates throughout the period, beginning at 4.05 and reaching a peak of 3.68 in August 2023. While not consistently increasing, the ratio generally remains above its initial value. A slight downward trend is observed in the most recent periods, with the ratio ending at 3.30. This suggests a potential shift in the relationship between revenue and equity, possibly due to changes in capital structure or profitability.

In summary, the company generally improved its asset utilization efficiency over the analyzed timeframe. However, recent quarters indicate a potential stabilization or slight decline in some ratios, warranting further investigation into the underlying drivers of these changes.

The net fixed asset turnover ratio demonstrates a generally positive trend over the analyzed period, indicating increasing efficiency in generating revenue from fixed assets. However, fluctuations and a recent slight decline warrant further examination.

Overall Trend

From August 31, 2020, through November 30, 2022, the ratio consistently increased, moving from 7.51 to 10.12. This suggests a strengthening ability to generate sales revenue for each dollar invested in property, plant, and equipment. The period between February 28, 2021, and November 30, 2022, shows particularly strong growth, with the ratio nearly increasing by 34%.

Peak and Subsequent Fluctuations

The ratio peaked at 10.12 in November 2022. Following this peak, the ratio experienced some volatility. It decreased to 10.08 in February 2023, then increased slightly to 10.15 in February 2024, before declining again.

Recent Performance

The most recent quarters show a slight downward trend. The ratio decreased from 10.27 in May 2024 to 9.59 in November 2024, and continued to 9.60 in May 2025. While still relatively high, this recent decline suggests a potential weakening in the efficiency of fixed asset utilization. The ratio remains within a reasonable range, but the trend should be monitored.

Relationship to Revenue and Fixed Assets

The increase in the ratio generally aligns with increases in revenue. However, the slight decline in the ratio in recent quarters, despite relatively stable revenue, suggests that the net property, plant, and equipment may be increasing at a faster rate than revenue, or that asset utilization is becoming less efficient. Further investigation into the composition and utilization of fixed assets is recommended.

In conclusion, the net fixed asset turnover ratio generally indicates efficient asset utilization, but the recent fluctuations and slight downward trend require continued monitoring to ensure sustained operational efficiency.

The net fixed asset turnover ratio, calculated using property, plant, and equipment net of accumulated depreciation including operating lease and right-of-use assets, demonstrates a generally positive trend over the analyzed period, with some fluctuations. Revenues exhibit a similar pattern of growth and occasional decline, influencing the turnover ratio’s behavior.

Overall Trend

From August 2020 through November 2024, the ratio generally increased, indicating improving efficiency in generating revenue from fixed assets. A peak was observed in November 2022 at 6.41, followed by a slight decline and subsequent stabilization. The final two periods (February 2025 and May 2025) show a slight decrease, but remain within the range established during the period of growth.

Initial Period (Aug 31, 2020 – May 31, 2021)

The ratio experienced moderate growth, increasing from 4.59 to 5.56. This coincided with a recovery in revenues following initial impacts from external factors. The asset base remained relatively stable during this period.

Growth Phase (Aug 31, 2021 – Nov 30, 2022)

A consistent upward trend was observed, with the ratio reaching its highest point of 6.41 in November 2022. This was driven by both increasing revenues and a slight decrease in the net fixed asset base, suggesting improved asset utilization. Revenues increased from 12,248 to 13,315 during this period.

Recent Performance (Feb 28, 2023 – May 31, 2025)

Following the peak in November 2022, the ratio experienced a slight decline, fluctuating between 6.01 and 6.65 before settling at 6.01 and 6.14 in the final two periods. While revenues remained relatively stable, the net fixed asset base showed a slight increase, contributing to the modest decrease in turnover. The ratio remains at a historically strong level despite this recent fluctuation.

Relationship to Revenue

The net fixed asset turnover ratio is directly correlated with revenue performance. Periods of revenue growth generally correspond with increases in the ratio, while revenue declines tend to result in a lower ratio. This indicates that the company is effectively leveraging its fixed assets to generate sales.

In conclusion, the net fixed asset turnover ratio demonstrates a generally positive trend, indicating efficient asset utilization. Recent fluctuations suggest a potential stabilization, but the ratio remains at a strong level, reflecting the company’s ability to generate revenue from its fixed asset base.

The total asset turnover ratio for the analyzed period demonstrates a generally increasing trend, punctuated by some fluctuations. Initially, the ratio exhibited relative stability between 1.10 and 1.22 for the first six periods. A notable increase began in the seventh period, continuing through the fourteenth, reaching a peak of 1.40. Subsequently, the ratio experienced a slight decline, stabilizing around 1.23-1.38 for the remaining periods.

Initial Period (Aug 31, 2020 – Nov 30, 2021)

The ratio remained relatively consistent, fluctuating between 1.10 and 1.22. This suggests a stable relationship between revenue generation and asset utilization during this timeframe. Minor variations likely reflect seasonal sales patterns or short-term operational adjustments.

Accelerated Growth (Feb 28, 2022 – May 31, 2023)

A clear upward trend is observed, with the ratio increasing from 1.18 to a high of 1.40. This indicates a significant improvement in the efficiency with which assets are being used to generate revenue. The company was able to generate more sales revenue for each dollar of assets employed. This could be attributed to improved operational efficiency, successful marketing campaigns, or increased demand for products.

Stabilization and Slight Decline (Aug 31, 2023 – Nov 30, 2025)

Following the peak, the ratio experienced a moderate decline, settling in the range of 1.23 to 1.38. While still representing a strong level of asset utilization, the decrease suggests a potential slowing of growth in revenue relative to asset investment. This could be due to increased asset investment to support future growth, or a stabilization of sales after a period of rapid expansion. The ratio remains relatively stable within this period, indicating a consistent, though slightly reduced, level of efficiency.

Overall, the trend suggests improving asset utilization over the analyzed period, with a particularly strong performance between February 2022 and May 2023. The subsequent stabilization and slight decline warrant continued monitoring to determine if this represents a temporary fluctuation or a more sustained shift in the relationship between revenue and assets.

The equity turnover ratio for the analyzed period demonstrates a generally stable pattern with moderate fluctuations. Initially, the ratio decreased from 4.05 to 3.23 between August 2020 and February 2021. A subsequent period of relative stability and slight increases followed, peaking at 3.66 in February 2023. The ratio then experienced a gradual decline, ending at 3.30 in May 2025.

Overall Trend

The overall trend indicates a slight decrease in equity turnover over the five-year period. While there are quarterly variations, the ratio generally moves from a higher level in the beginning of the period to a lower level towards the end. The initial decline is more pronounced than subsequent fluctuations.

Short-Term Fluctuations (2020-2021)

Between August 2020 and February 2021, a noticeable decrease in equity turnover is observed. This suggests that revenues were not growing as quickly as shareholders’ equity during this period, or that equity decreased at a faster rate than revenues. The ratio recovered somewhat in the following quarters, but did not return to the initial level.

Period of Stability (2021-2023)

From August 2021 to February 2023, the equity turnover ratio remained relatively stable, fluctuating between 3.06 and 3.66. This indicates a consistent relationship between revenues and shareholders’ equity during this time. The peak in February 2023 suggests a period of efficient asset utilization relative to equity.

Recent Decline (2023-2025)

The most recent period, from February 2023 to May 2025, shows a gradual decline in the equity turnover ratio. This suggests that revenues have not kept pace with shareholders’ equity in recent quarters, potentially indicating a decrease in the efficiency of generating revenue from equity investments. The final value of 3.30 represents the lowest point in the analyzed period.

In summary, the equity turnover ratio suggests a moderate, long-term decline in the efficiency with which equity is used to generate revenue. While short-term fluctuations exist, the overall trend warrants further investigation to understand the underlying drivers of this change.