Is Nike Good Dividend Stock

Is Nike Good Dividend Stock by Ashly Chole last updated on August 01, 2026

Is Nike A Good Dividend Stock?

Nike is an iconic brand with global reach. However, its performance in the stock market is not that good. Nike stock is in a long-term downtrend and has lost 32% of its value.

It made an ATH back in COVID-19, but that seems like a distant dream now for investors. But does this mean investors should buy this stock as it is available at a discount? To answer this, we must look closely at what's happening with Nike.

Nike's Dividend Yield Is 3.7%

The dividend yield of Nike is now sitting at 3.7%. That's almost three times more than the average from the S&P 500. But the increase in the dividend yield is mainly from the falling share prices.

The reality is that Nike is still facing multiple headwinds. This includes high energy prices and high inflation. Both of these things are hurting consumer spending. For FY 2026, Nike's revenue was mostly flat, and it was not taken positively by investors.

The 12-month free cash flow of Nike has also fallen by 65% and is now around $1 billion. This means it will become more difficult for Nike to keep paying the dividend. So, if the only reason to buy Nike shares is dividends, then that reason might disappear in the near future.

As for Nike's turnaround, everyone agrees that it will take a lot of time. The management is trying to boost margins by reducing the discounts. They are also trying to adjust the product mix in order to improve sales growth.

The company is also working on launching new footwear styles for consumers. However, it remains to be seen how these will be received by consumers.

The bottom line is that turnaround is in progress, but its pace is slow. The management thinks its actions will eventually improve the margins.

So yeah, it is not a good idea to buy the Nike stock just for the dividend. The company's share price is highly likely to fall in 2026 and even in 2027. So, the dividend payments alone won't be enough to cover the losses.

And the way things are, there's a good chance that Nike might lower its dividend yield or stop paying it for a year or two.