Raytheon awarded $71 million in Navy contracts for missile systems
BEAVERTON, OR – NIKE, Inc. (NYSE:NKE), the $113 billion market cap sportswear giant with annual revenues of $49 billion, has entered into two new credit agreements, securing up to $3 billion in total funding, according to a recent SEC filing. According to InvestingPro data, NIKE maintains a "GOOD" overall financial health score, with strong liquidity metrics supporting its financing activities. On Thursday, the sportswear giant replaced its existing credit facilities with a new 364-Day Credit Agreement and a Five Year Credit Agreement, both orchestrated by Bank of America, N.A., among other financial institutions.
The 364-Day Credit Facility allows NIKE to borrow up to $1 billion for working capital and general corporate purposes, including the support of commercial paper issuance. This agreement, which matures on March 6, 2026, may be increased to $1.5 billion, with the possibility of an additional 364-day renewal or conversion into a term loan for up to one year.
Simultaneously, NIKE secured a Five Year Credit Facility, providing up to $2 billion with similar terms and purposes as the 364-Day Credit Agreement. This longer-term facility, maturing on March 7, 2030, can be increased to $3 billion and has options for up to two one-year extensions, not exceeding March 7, 2032.
Both credit facilities offer borrowing in multiple currencies and contain covenants restricting additional liens, mergers, acquisitions, dispositions, and the use of loan proceeds. Notably, neither agreement includes financial covenants, a detail that might interest investors monitoring the company’s financial flexibility. InvestingPro analysis shows NIKE operates with a moderate debt level, maintaining a healthy total debt-to-capital ratio of 9% and a strong current ratio of 2.22, indicating robust financial flexibility.
In conjunction with these new agreements, NIKE terminated its previous credit facilities dated from March 8, 2024, and March 11, 2022, respectively. The termination of these prior agreements coincided with the inception of the new facilities on March 7, 2025. As of the termination date, there were no outstanding amounts under the previous facilities.
The financial institutions involved in these agreements have previously and may continue to provide various banking and advisory services to NIKE, for which they receive customary fees and expenses.
The information in this article is based on a press release statement.
In other recent news, Nike has been in the spotlight due to several key developments. UBS analyst Jay Sole maintained a Neutral rating on Nike stock with a $73 price target, projecting a revenue decline of 10.3% for fiscal year 2025, followed by modest growth in subsequent years. Earnings before interest and taxes (EBIT) margin is expected to remain between 10% and 11%, indicating a challenging path ahead for significant margin improvement. Meanwhile, Jefferies upgraded Nike from Hold to Buy, with a new price target of $115, expressing confidence in the company’s leadership and potential for market recovery. Jefferies anticipates a V-shaped recovery in Nike’s margins and earnings per share by fiscal year 2027.
Bernstein analysts maintained an Outperform rating with a $102 target, highlighting strong growth expectations in Nike’s Performance footwear and Apparel segments, despite declines in Classic Lifestyle franchises. Bernstein projects an earnings per share range for fiscal year 2026 between $2.30 and $3.10, suggesting potential for structural earnings growth. Additionally, Nike announced a partnership with Skims to launch a new women’s activewear brand, NikeSkims, set to debut its first collection in spring 2025. This collaboration aims to blend Nike’s sports performance expertise with Skims’ design focus on inclusivity, catering to women athletes worldwide.
These recent developments underscore Nike’s strategic initiatives to navigate market challenges and capitalize on growth opportunities in the coming years.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.