Nike and Lululemon Settle Patent Dispute, Nike Stock Seen as Undervalued by 50%

Nike Inc (NKE) and Lululemon Athletica (LULU) have resolved their multi-year patent dispute over Mirror fitness technology, dismissing the lawsuit with prejudice. The agreement brings an end to litigation that began in 2022.

The resolution comes as Nike offers a dividend yield of 4.5%, supported by a 3-year dividend growth rate of 7.1%. However, its payout ratio stands at 78%, raising concerns about sustainability if earnings weaken.

Nike's GF Value is $72.91 compared to the current price of $36.36, indicating the stock is undervalued by approximately 50.1%.