Can somebody explain why ESPP was purchased on Sept 29 ($95 close price) when it's supposed to be Sept 30 ($83 close price)? Seems like a big middle finger to the team and it did not go unnoticed.
6 replies (most recent on top)
Original topic was resolved but Nike was trading at a forward P/E ratio of 30x earnings, especially when we were hoovering around 170$ stock price. Essentially, valuation got crushed. Globally. Nike performance also didn't help the stock price, but we're getting closer to market valuation which is hoovering around 65$ a share.
Does that mean sell now? Probably not, there isn't a guarantee we'll ever get down the 65 but its something to pay attention to, especially if you're making a significant purchase in the future.
If you think ESPP has been disappointing, wait until we get PSP numbers next year. I have a feeling the next PSP check is going to be one of the lowest since PSP began. At this rate I’ll be surprised to see 50% of target.
@3yrb, I wouldn’t pay much attention to analysts stock price projections. There’s a very good reason those people aren’t working on the actual trading floors at their respective outfits. Data has shown time and time again that the average Wall Street analyst can’t outperform even the basic market indexes.
It actually goes back further than 2022. The ESPP purchase prices in 2021 were $106.71 and $112.96. Add that to the March price of $117.96 and the most recent one, and anyone who invested in ESPP over the past 2 years and held it is sitting on an almost 20% decline with the stock selling at $86 right now.
That said, the previous poster is correct. If you hold onto the stock long enough, you will likely reap positive gains eventually assuming the company keeps being profitable and overcomes the recent issues (inventory build up, etc). Right now, most analysts are predicting a target price of $110 in the next year, so those ESPP shares from 2021 and 2022 will be losers for quite awhile.
I feel the pain of these posts. I do think it's worth remembering: you should not be investing in stock in the short term (and especially money needed in the next 1-2 years). Personally, I don't think you should ever be losing money on NKE ESPP because you shouldn't be in a position to force a sale (tax harvesting is a whole other topic that I'm not referring to here).
Unfortunate timing on these last two buy dates for sure, but it'll be a blip on the radar in the long term.
Think of ESPP as just a longer-range dollar cost averaging - you'll win some and you'll lose some, but it will end up better than trying to time the market (in the long-long term)
It was really cr---y timing in March also. There was a temporary spike that month, leading to a $117 "discounted" buy-in price and the stock tanked right afterward. Those shares have been underwater almost since they were bought and they'll probably be a money loser for a couple years at least.
Obviously, ESPP hasn't been great this year. In fact, I think it's the first time I've lost money in an ESPP plan in over 20 years of my career across a few different companies. Not coincidently, Nike is one of the worst performing stocks in 2022, losing over half of it's value since January.
"Employee Stock Purchase Price will be the Lower of the beginning or end of the Offering Period using the Closing Price on the Prior Day"
It's always been the closing price on the day before the last day of the offer period. Really cr---y timing this time around.