Gasoline Prices Are Still High, but This Inflation Reading Could Be Even More Worrisome for Nike Stock.
Nike stock is confounded by multiple forms of inflation, including high producer prices.
Gasoline Prices Are Still High, but This Inflation Reading Could Be Even More Worrisome for Nike Stock.
Overview
Inflation is often a drag on equities, but it can really highlight the vulnerabilities of select consumer discretionary stocks. After all, if prices rise too quickly, shoppers respond by altering their spending habits, and many of those changes involve non-essential spending.
Then there's the other kind of inflation. That is the form companies deal with themselves. It's measured by the Producer Price Index (PPI), which showed potentially alarming signs for companies like Nike (NYSE: NKE) in May. Last month, the PPI surged 6.5% year over year, signaling potentially worrisome signs for input-cost-sensitive corporations such as Nike.
Nike stock is beset by tariffs and rising producer prices. Image source: Getty Images.
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Originally published at www.fool.com.
