Factors Behind SGA U.S. Large Cap Growth Strategy’s New Addition: Nike (NKE)

Core Insights - SGA's U.S. Large Cap Growth Strategy reported a portfolio return of -1.3% (Gross) and -1.4% (Net) in Q3, underperforming the Russell 1000 Growth Index which returned 10.5% and the S&P 500 Index which returned 8.1% [1] - The investment strategy focuses on high-quality growth businesses expected to achieve consistent mid-teens earnings growth, but faced challenges as lower-quality stocks and cyclical industries outperformed in the market [1] Company Analysis: NIKE, Inc. (NYSE:NKE) - NIKE, Inc. is recognized as an iconic sportswear brand that promotes a healthier lifestyle through its innovative products, which include athletic and casual footwear, apparel, and accessories [3] - The stock of NIKE, Inc. experienced a one-month return of -3.01% and a 52-week decline of 13.52%, closing at $63.71 per share with a market capitalization of $94.176 billion on December 31, 2025 [2] - NIKE's pricing power is supported by its strong brand and technology, with a robust supply chain that gives it an advantage over competitors, who have lower margins and would be more adversely affected by price wars [3] - The company benefits from repeatable revenues, with 65% of sales coming from shoes, a category known for customer loyalty, and is experiencing mid-single-digit revenue growth in developed markets, while growth in emerging markets is even faster due to increased sports participation and e-commerce sales [3]