Nike Now Yields More Than Coca-Cola. Is the Turnaround Finally Priced In?

NKE's dividend yield has surged to 4%, eclipsing KO's 2.4%, a reversal driven by a depressed share price rather than deteriorating fundamentals. The athletic giant now trades at 1.3x price-to-sales, well below its historical 2.0x+ multiple, while management projects free cash flow will rebound to $3 billion in fiscal 2027.

Despite a 2% currency-neutral revenue decline in the latest period, Nike Running has posted five consecutive quarters of double-digit growth, signaling category-level momentum. Margins are expanding, and the current dividend—now yielding twice KO's payout—remains fully covered by projected cash generation.

The valuation disconnect is stark: NKE's yield inversion versus a defensive name like KO typically signals either deep value or structural risk. Here, operating metrics point to the former. The Running segment's sustained double-digit gains and margin improvement suggest the turnaround thesis is gaining traction, even as the headline revenue number lags.