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Nike Delivers Everything That Shareholders Could Ask For All at Once

Nike Inc. (NYSE: NKE) may be among the newest Dow Jones Industrial Average stock, but it is delivering secular growth and a has seen a strong gain in its shares of late. Now the company is delivering everything that shareholders love to hear: raising the dividend, buying back more stock and even splitting its shares.

Seriously, this sounds like an investor wish list that gets sent to Santa this time of the year. Now you know why Merrill Lynch was so positive on Nike.

Nike is delivering a 14% dividend hike for its shareholders. The dividend hike is good, but investors will need to consider that the share price gains have now created the current yield of only 0.9%. Investors will now receive $0.32 per share on a pre-split basis versus the previous pre-split quarterly rate of $0.28 per share. That new yield will generate a yield of about 1% if the stock quits going up.

The company went on to say that this dividend hike will mark the fourteenth year in a row that it has increased its annual dividend. Over that period, the dividend payment each year has increased tenfold.

Nike’s buyback plan is $12 billion with a...