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tion.” Perez is eschewing media inter-views, planning to outline his plan forNike publicly June 28. Knight and otherNike officials also declined to be inter-viewed by Barron’s, citing an impendingfourth-quarter earnings release.

To ensure a smooth transition, Knight,Nike’s biggest stockholder with 92%—66million—of its Class A shares, is stayingon as chairman. In addition, managementtightened the golden handcuffs on MarkParker and Charlie Denson, the highlyregarded co-presidents of the Nikebrand, who were passed over for theCEO post. Their non-compete agree-ments were sweetened and revised. Infact, dissuading key executives from bolt-ing is one of Perez’s biggest challenges.But, even if there are some defections,Nike appears to have a deep bench.

Still, the corner-office switch has castuncertainty over Nike, as does a slow-down in Japan’s shoe market, slack econo-mies in Europe, where Nike gets about30% of its revenue, and worries about aconsumer spending slowdown in the U.S.And the dollar’s rebound against the euroalso could crimp earnings. Foreign-cur-rency gains accounted for half of fiscal2004’s 27% earnings growth.

These concerns have knocked Nikefrom its 52-week high of 92, which itreached in December. When it slumped toaround 76 in April, Rich Cervone of Put-nam Investors Fund scooped up shares.“It’s still cheap,” Cervone says of thestock, citing Nike’s “strength of brand,competitive advantage…strong return oninvested capital and cash flow.”

Now in the mid-80s, Nike fetches 17

times analysts’ fiscal 2006 earnings esti-mate of $5.03, below its historical forwardprice-earnings multiple of 21 since 1995and about in line with the S&P, despitebetter profit growth. Reebok, at its re-cent price of 42.50, sported a P/E of 11 onits expected 2006 net of $3.81 a share.

Based on 20 times his fiscal 2007 esti-mate of $5.50 and discounted cash flow,Ohmes of Banc of America sees Nike hit-ting $110 in 12-to-18 months. A big plus:Nike’s sterling balance sheet. At the endof the third quarter, the company reportedlong-term debt of $800 million and cash of$1.64 billion. The stock is also aided by anaggressive share-buyback program and a90-cent-a-share annual dividend.

Furthermore, the athletic-shoe indus-try is riding one of its strongest cycles inyears. John Horan, publisher of Glen Mills,Pa.-based magazine Sporting Goods Intelli-gence, sees the $9 billion U.S. branded-

shoe market rising 8% this year.Knight, a 67-year-old former runner,

helped found Nike in 1972 and struck mar-keting gold by inking Jordan in 1985.Nike, which went public in 1980, rode therunning craze and Jordan’s basketballbrilliance to 47% of the shoe market in1997. But inventory problems, design mis-steps and a weak shoe market later de-flated sales and earnings growth.

Nike now has a dominant 36% of theU.S. shoe market. But some analysts viewit as too dependent on the fashion-drivenshoe business, particularly its most ficklesegment—the high end—and too alooffrom retailers. Two years ago, a disputeover Foot Locker’s promotional practicesfor Nike shoes caused a costly one-yearrift between the shoemaker and the re-tailer. Under Perez, “there’ll be more ofan effort to partner up with retailers,”predicts Susquehanna analyst Shanley.

Perez has visited executives at FootLocker, Finish Line and Dick’s SportingGoods, three of Nike’s biggest retail part-ners. Generally, if vendors wished to seeKnight, they’d have to go to him.

Nike also wants to erase its image ofbeing indifferent to workplace woes inthe Third World, recently releasing a listof the factories that make its products.Such moves should increase under Perez.

Wal-Mart and Target (TGT) officials arefamiliar with Perez, a good thing as Nikeseeks to broaden its distribution of sub-brands. The shoe producer is likely to ex-pand its stable of brands through acquisi-tions, similar to its $43-million purchase ofOfficial Starter Properties last year. Smalloutfits, such as Baltimore-based and pri-vately held Under Armour, could be tar-gets. Acquisitions may also help rev upNike’s women’s apparel operation. Thecompany’s overall women’s business gener-ates about $2 billion in revenue, but someanalysts consider it an underachiever.

Cowperthwaite also views Nike as anunderachiever in controlling expenses,now equal to 30.2% of sales. She’d likePerez to push them below 29%.

Perez also must bolster Nike abroad,where growth is faster than in the U.S.One big challenge: Japan, where sales ofhigh-end sneakers are flagging. Nike’sjuiciest opportunity: China, where it hasjust a single-digit market share. Cowper-thwaite sees Nike sales in Asia ballooningto $3.2 billion in four years from $1.6 bil-lion now. If she’s right, and Perez pushesConverse, Starter and other brands ashard as he runs marathons, Nike—and itsstock—will stay way ahead of the pack. n

Under William Perez – one of only twoHispanics at the helm of a Fortune 500company – Nike wants to boost sales ofits cheaper brands while expandingthose of its premium namesake shoes.In 2003, the last year for which reliablefigures are available, Nike’s share of the$19 billion global market more thandoubled that of No. 2 Adidas.

Ticker: NKE

Recent price: $85.65

52-wk range: $68.61 - $92.43

Market value: $22.5 bil.

Fiscal year ends: May 31

Earns. per share: 2004 $3.51

2005E $4.45

2006E $5.03

2004 Revenues: $12 bil.

Price/Earns (2006E): 17.0

Debt/Capital: 12.1

Dividend yield: 1.17%

CEO Perez

NIKE BY THE NUMBERS

Nike 33%

Other Brands 28

Adidas 16

Reebok 10

New Balance 7

Puma 6

GLOBAL PACESETTERS(2003 Sales)

New Leader, New Strategy

E=Estimated Sources: Sporting Goods Intelligence; Company reports; Bloomberg

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C A D I L L A C.C O M

20 B A R R O N ' S June 13, 2005

CUSTOMERSHigh Net Ultra High Total Typical Typical

Individuals Worth Net Worth Corpor- Found- Endow- Assets Account Net Worth Rank Name Firm Location (Up to $1 mil) ($1-$10 mil) ($10 mil+) ations ations ments ($ mil) ($ mil) ($ mil) Score

1. Martin Shafiroff Lehman Brothers New York u u u 20,000* 1-100 1-5,000 10.000

2. Mark Curtis Smith Barney Palo Alto, Calif. u u u u u u 9,000 10 25 9.884

3. Richard Saperstein Bear Stearns New York u u u 7,450 60 N.A. 9.767

4. Brian Pfeifler Morgan Stanley New York u u 3,000 25 50+ 9.636

5. August Cenname Merrill Lynch Columbus, Ohio u 5,100 50 100 9.521

6. Marvin McIntyre Legg Mason Wood Walker Washington u u u u u 2,500 3-10+ 5-50+ 9.517

7. Gregory Vaughan Morgan Stanley Menlo Park, Calif. u u u 3,500 20-25 50 9.318

8. Robert Coleman Morgan Stanley San Francisco u u u u 2,500 10-100 50+ 9.256

9. Jon Goldstein Smith Barney Menlo Park, Calif. u u 3,000 25+ 25+ 9.145

10. Howard Rowen Deutsche Bank Alex.Brown Los Angeles u u 1,700 25 50+ 9.082

11. Robert Dixon Morgan Stanley Menlo Park, Calif. u u u 3,000 25 + 75-100 9.011

12. Louis Chiavacci Merrill Lynch Coral Gables, Fla. u u u u 2,100 10 60-70+ 8.938

13. Drew Zager Morgan Stanley Los Angeles u u 5,700 40 100 8.805

14. Ric Edelman Edelman Financial Svcs Fairfax, Va. u u u u 2,600 0.3-1 1 8.731

15. Robert Stulberg Merrill Lynch Bloomfield Hills, Mich. u u u 2,000 5+ 5-100+ 8.650

16. Andrew Perry Deutsche Bank New York u u 2,750 10+ 25+ 8.563

17. William Gurtin Morgan Stanley Rancho Santa Fe, Calif. u 4,300 5-500 20-1,000 8.454

18. Ira Walker Morgan Stanley Red Bank, N.J. u u u 2,000 10+ 35+ 8.383

19. Paul Tramontano Smith Barney New York u u u 5,000 10 25 8.278

20. Mark Sear Merrill Lynch Los Angeles u u 2,000 25 35 8.196

21. David Hou Merrill Lynch Los Angeles u u 2,000 25 35 8.196

22. Richard Blosser Morgan Stanley Los Angeles u u u 2,000 10-100 50+ 8.094

23. Jeff Erdmann Merrill Lynch Greenwich, Conn. u u 2,500 5-50 25-70 7.962

24. Dana Jackson Smith Barney Menlo Park, Calif. u u u 2,000 5 10+ 7.901

25. Raj Sharma Merrill Lynch Boston u u u u u 3,650 10 10 7.820

26. Joseph Montgomery Wachovia Securities Williamsburg, Va. u u u u u u 6,800 3-5 5-10 7.658

27. Jim Hansberger Smith Barney Atlanta, Ga. u u u u 1,500 10-20 25-100 7.612

28. Martin Halbfinger UBS Financial Services New York u u u u u 1,400 2-50 5-100 7.559

29. John C. Korbell Smith Barney San Antonio u u u u 1,154 3-5 5-10 7.536

30. John W. Rafal Essex Financial Services Essex, Conn. u u u u u 1,400 2 3-10 7.473

31. Rebecca Rothstein Smith Barney Beverly Hills, Calif. u u u u 980 N.A. 10-700 7.417

32. Sanford Katz UBS Financial Services San Francisco u u u 1,070 15-50+ 20-100 7.378

33. Gary Ran Telemus Capital Partners Southfield, Mich. u u 1,350 1-10 10-50+ 7.327

34. Saly Glassman Merrill Lynch Blue Bell, Pa. u u u u u u 945 5 15 7.293

35. Dean Trindle Merrill Lynch & Co., Inc. Cincinnati u u u 3,000 1-3+ 3-10+ 7.212

36. Mark Douglass Morgan Stanley Menlo Park, Calif. u u u u 3,000 10-25 25-50 7.121

37. Ron Carson Carson Wealth Mgmt Grp Omaha, Neb. u u u 1,012 1-5+ 3-10+ 7.084

38. Stephanie Stiefel Neuberger Berman New York u u u 815 4.5 25 7.059

39. Phil Scott Merrill Lynch Bellevue, Wash. u u u u 750 5 10 7.037

40. Bernard King UBS Financial Services St Louis u u u u 1,000 1-25 1-50 7.001

41. Peter Phelan Neuberger Berman New York u u u u u 1,089 3.6 10 6.950

42. Charles Zhang Zhang & Associates Portage, Mich. u u u u 800 2 3 6.935

43. George Dunn Smith Barney Washington u u u u 3,000 25-300 25+ 6.844

44. Thomas Buck Merrill Lynch Indianapolis u u u u u 775 2-3 3 6.831

45. Alan Whitman Morgan Stanley Pasadena, Calif. u u u 1,064 1-10+ 3-20+ 6.781

46. John Kulhavi Merrill Lynch Farmington Hills, Mich. u u u 710 0.5-3 2-5 6.762

47. Nick Bapis Morgan Stanley Salt Lake City u u u 1,800 5 10 6.697

48. Michael Johnston Smith Barney Irvine, Calif. u u 1,050 5-50+ 10-75 6.668

49. Harry Ford Legg Mason Wood Walker Baltimore u u u u u u 600 1-5 3-10 6.648

50. Walter Meranze Wachovia Securities Yardley, Penn. u u u u u 2,300 1.2 6 6.570

51. Seth Finkel Neuberger Berman New York u u u u 925 5.3 5-10 6.537

52. Lori Van Dusen Smith Barney Rochester, N.Y. u u u u u 2,700 50 20 6.452

53. Jonathan Harris Morgan Stanley San Francisco u u u u 2,500 20 20-100 6.370

54. Dana Locniskar Merrill Lynch Detroit u u 1,765 5-25 10-30 6.315

55. Thomas E. Hill Legg Mason Easton, Md. u u u 940 300 2 6.272

56. Thomas Lips UBS Financial Services Hartford, Conn. u u u u u 700 1-20 5-50 6.254

57. Steve Hefter Morgan Stanley Highland Park, Ill. u u u 900 7-15 10-500 6.223

58. Scott Thayer Smith Barney Santa Rosa, Calif. u u u u u 1,750 5-10 5-10 6.159

59. Richard Petit Morgan Stanley Menlo Park, Calif. u u 1,500 10-50+ 25+ 6.102

60. John Olson Merrill Lynch New York u u u 1,350 2-30 5-50 6.051

61. John Cooke Wachovia Securities Indianapolis u u u u u 900 1-5 2-15 6.020

62. M. Keefe Gorman Merrill Lynch Ithaca, N.Y. u u u u 6,347 1-5 1-15 5.892

63. Donald DeWees Wachovia Securities Greenville, Del. u u u u u 750 1-3 5 5.870

64. David Ellis III McDonald Financial Group Cincinnati u u u u u u 1,000 1-10 2-20 5.834

65. Michael C. Dawson UBS Financial Services Houston u u u 2,800 25+ 50-100+ 5.746

66. Brian E. Hahn Neuberger Berman Chicago u u u 700 7.5 25 5.728

The Top 100Here are America's best financial advisers from the brokerage industry, as identified by researcher R.J. Shook, author of the Winner's Circle books. The brokers, he says, followthe industry's best practices and have the biggest books of business. The scoring system assigns a value of 10 to the top broker; the other scores are calculated by comparingeach broker with the No. 1 finisher in terms of assets, revenue, customer satisfaction and other factors. Total assets include those at the adviser’s firm and held elsewhere butoverseen by the adviser. The scoring gives less weight to institutional assets.

June 13, 2005 B A R R O N ' S 29

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Call 1-877-929-2434 or visit etrade.com/mm

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1. Annual Percentage Yield (APY) of 2.65% as of 5/27/05 and applies to accounts with balances of $50,000 or more. Accounts with balances of $5,000-$49,999 will earn 1.80% APY and accounts with balances of less than $5,000 will earn a 0.30% APY. A $100 minimum initial deposit is required to open an E*TRADE Money Market Account and you must maintain a minimum average monthly balance of $1,000 in your E*TRADE Money Market Account, or $5,000 in total E*TRADE Bank deposits, by the end of your second statement cycle to avoid a $10 monthly fee on the account. Certain fees may reduce earnings on account.Yields subject to change daily. 2. E*TRADE Bank will not charge you a fee for withdrawing funds from a non-E*TRADE FINANCIAL ATM but the owner/operator of that ATM may. This feature will refund the fees charged by the ATM owner/operator on all ATM fees through December 31, 2005 as long as the ledger balance of the account on the day of the withdrawal exceeds $5,000. Withdrawal limits apply. Under federal regulations related to these types of accounts, account holders are allowed six withdrawals or transfers from their account in any calendar month (ATM withdrawals excluded), with a maximum of three withdrawals by check. Banking and lending products and services are offered by E*TRADE Bank, a Federal savings bank, Member FDIC, or its subsidiaries. Bank deposits are FDIC insured up to $100,000. © 2005 E*TRADE FINANCIAL Corp. All rights reserved.

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June 13, 2005 B A R R O N ' S 19

67. William J. Sullivan UBS Financial Services Boston u u 700 5 25 5.709

68. Larry Palmer Smith Barney Los Angeles u u u u u 1,000 5 10+ 5.673

69. Gregory Hurlbrink Legg Mason Wood Walker Baltimore u u u u 711 2-3 5-10 5.654

70. Dan Osborne Banc of Amer Invest Svcs San Francisco u u u 1,750 5 10 5.590

71. David Novelli Smith Barney Houston u u u u 980 3.5 10 5.555

72. Kevin Myeroff NCA Financial Planners Cleveland u u 625 1.5 3 5.542

73. James Snyder Legg Mason Wood Walker Bowie, Md. u u u 620 0.5-2 1-3 5.530

74. Mark Pollard Merrill Lynch Plainsboro, N.J. u u u u 1,800 2.5-15 3.5-20 5.464

75. Alan Leist Cadaret Grant Utica, N.Y. u u u u u u 725 1.2 5 5.444

76. James McCabe Wells Fargo Investments Beverly Hills, Calif. u u u 1,027 5 5+ 5.407

77. Peter Eckerline Merrill Lynch Wayzata, Minn. u u u u 610 1-15 2-20 5.395

78. Sharon Oberlander Merrill Lynch Chicago u u u u 600 2+ 3-5 5.385

79. Scott Magnesen Morgan Stanley Oak Brook, Ill. u u u u 1,200 0.5-1.5 1-2 5.339

80. Patricia Bell Merrill Lynch Short Hills, N.J. u u u 513 1-10 5-10 5.337

81. Ken Van Wagenen Wells Fargo Investments Los Angeles u u u u u u 1,100 3+ 10+ 5.296

82. Alan Jusko Wachovia Securities New York u u u u 720 0.75 1 5.275

83. Richard Szelc Neuberger Berman Dallas u u u 610 8 15 5.228

84. Timothy Kneen Smith Barney Englewood, Colo. u u u u u 1,000 10 15 5.228

85. Michael Swenson Piper Jaffray Wayzata, Minn. u u u u 1,058 2-20 5-100+ 5.189

86. James Minchello Smith Barney Boston u u 2,087 5-20 10 5.114

87. Charlie Graham Legg Mason Gaithersburg, Md. u u u u 650 0.5-1.5 1-3+ 5.112

88. Steve Spence UBS Financial Services Portland, Ore. u u u u u u 600 1.5 5 5.091

89. Jeffrey Cohen Lincoln Sagemark Tarrytown, N.Y. u u 700 2.5-5+ 10+ 5.073

90. Larry Boggs Wachovia Securities Cumberland, Md. u u u 650 1-3 1-5 5.058

91. Mary Deatherage Smith Barney Little Falls, N.J. u u 675 2-10+ 10+ 5.044

92. Meg Green Meg Green & Associates North Miami Beach, Fla. u u u 640 1-3+ 2-10 5.028

93. Scott Tiras Amer Express Finl Adv Houston u u u 600 1-3 2-5 5.017

94. Todd Feltz Linsco/Private Ledger Omaha, Neb. u u u 543 0.75-1.5 1.5-5 5.012

95. Nadia Cavner USBancorp Springfield, Mo. u u 530 1+ 1-3+ 5.007

96. Alexandra Armstrong Armstrong, Fleming & Moore Washington u u u 571 1-3 3-6 4.999

97. Kay Shirley Financial Development Atlanta u u 516 0.35-0.5 2 4.996

98. Ronald Weiner RDM Financial Group Westport, Conn. u u N.A. 1-5+ 2-6+ 4.976

99. Jim Wohlgemuth Deutsche Bank Alex.Brown Washington u u u 655 5-10 10-25+ 4.961

100. William Grové McDonald Investments Columbus, Ohio u u u 513 0.8-1.5 2.5-3.5 4.958

*Estimate by R.J. Shook FFoorr mmoorree iinnffoorrmmaattiioonn oonn WWiinnnneerr’’ss CCiirrccllee aanndd tthhee rraannkkiinngg mmeetthhooddoollooggyy,, ggoo ttoo wwwwww..wwiinnnneerrsscciirrcclleenneett..ccoomm Source: R.J. Shook of the Winner’s Circle Organization

CUSTOMERSHigh Net Ultra High Total Typical Typical

Individuals Worth Net Worth Corpor- Found- Endow- Assets Account Net Worth Rank Name Firm Location (Up to $1 mil) ($1-$10 mil) ($10 mil+) ations ations ments ($ mil) ($ mil) ($ mil) Score

Investment in commodity markets may not be suitable for all investors, and exposure to commodity markets should only form a small part of a diversified portfolio. Fund shares are not deposits or other obligations of Credit SuisseAsset Management, LLC ("CSAM") or any affiliate, are not FDIC-insured and are not guaranteed by CSAM or any affiliate. Fund investments are subject to investment risks, including loss of your investment. The fund's investmentobjectives, risks, charges and expenses (which should be considered carefully before investing), and more complete information about the fund, are provided in the prospectus, which should be read carefully before investing. Pleasecall 1-800-577-2321 for copies. The fund invests in commodity-linked derivative instruments, which can be more volatile than traditional commodities and securities, and entail substantial risks, including risk of loss of a significantportion of principal value, lack of a secondary market, increased volatility, correlation risk, liquidity risk, interest-rate risk, market risk, credit risk, valuation risk and tax risk. The fund is non-diversified. It may invest a greater portionof its assets in the financial instruments of a smaller number of issuers than a diversified fund and may be subject to greater volatility. ©2005 Credit Suisse Asset Management Securities, Inc., Distributor. All rights reserved.

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30 B A R R O N ' S June 13, 2005