Nike, Inc. (NKE) is doing horribly this afternoon. As I write this, a quote of $77.51 is on my screen. That represents a drop of over 9% for the shares. Volume is huge. Hopefully many of you out there didn't do an earnings trade on this one.

How bad were the fiscal Q3 numbers? According to MarketWatch, net income of $1.08 per share was four pennies below the overall call by Wall Street. In addition, the potential for a weakening gross margin is said to have played a part in the sell-off.

Nike, Inc. (NKE) is the largest global manufacturer of athletic footwear, apparel and equipment by sales volume, and competes with Sketchers, Adidas AG, Steven Madden and K-Swiss in the global footwear market. It sells its products under several brands including Nike, Nike Golf, Converse, Cole Haan, Umbro, and Hurley.

We maintain a $77.52 price estimate for Nike's stock, roughly 13% below market price.

The 2009 equity market recovery has led to an increase in Q ratios for the world's largest retailers. What does this mean? They're using their tangible assets effectively and have demonstrated the strength of intangible factors, such as brand and operational efficiency, to create shareholder value.

"Q" is the ratio of a public company's market capitalization to the market value of its tangible assets. So, a Q ratio of above one means that investors value the company's non-tangible assets -- e.g., brand, differentiation, innovation, customer experience and customer loyalty -- and see these factors as reasons to pay a higher price per share. A company with a Q ratio of below one can't generate a sufficient return on its physical assets. According to Deloitte, this could create an arbitrage opportunity, as it may be ripe for an acquisition.

Collective Brands (NYSE: PSS), which owns the Payless shoe store, issued its Q2 release after the bell on Wednesday. Earnings per share took a significant dive once you made some adjustments for last year's results. They came in at 29 cents per share, a decrease of over 40%. Net sales went down over 8%.

On the surface, the news isn't good -- and it gets worse. As we all know, every investor has to play the earnings game with Wall Street. Collective Brands lost the good fight. The market was looking for 33 cents per share, according to Earnings.com. Coming in four pennies short is about as comfortable as wearing sneakers two sizes too small. Shares of Collective Brands were punished in the after-hours' session, with investors bidding the stock down by close to 7% at one point, though it later recovered.

After the closing bell sounded yesterday, footwear firm Crocs (NASDAQ: CROX) reported second-quarter earnings, or should we say second-quarter loss -- yet the Street is ready to celebrate.

The foam footwear manufacturer reported a second-quarter loss of $30.3 million, or 36 cents per share. Taking a $34.8 million charge out of the equation, CROX would have lost a mere six cents per share. While these results are worse than those of a year ago, they managed to top Wall Street's expectations for a loss of 21 cents per share.

Solid performance in the earnings spotlight from Under Armour (NYSE: UA), as the company reported a surprising profit of three cents per share. Under Armour's earnings topped the consensus estimate for a loss of two cents per share and matched the company's year-ago results. Quarterly revenue increased to $164.6 million from $156.7 million a year ago.

The results were driven by a 16.5% increase ($112 million) in clothing revenue, which compensated for an 18.4% drop ($37.5 million) in footwear from a year ago. Looking ahead, Under Armour forecast 2009 earnings between 80 and 82 cents per share, better than the consensus estimate for earnings of 79 cents per share. As far as revenue is concerned, the Maryland-based firm expects $810 million compared to $804.9 from the Street.

Collective Brands (NYSE: PSS), a footwear retailer that competes with companies such as Wal-Mart (NYSE: WMT) and Kohl's (NYSE: KSS), issued Q1 results on Wednesday after the bell. The business earned 59 cents per diluted share. That represented a decline over last year's results which, on an adjusted basis, calculated out to 66 cents per share.

That's not the only disappointing news. You also have a sales decline, impacted by currency effects (of course), as well as the expiration of a license related to the Tommy Hilfiger brand. Also, same-store sales dipped by 4.8% on a reported basis, and 3.2% after the exclusion of currency translation. As can be seen, you can look at same-store sales any way you'd like, but in the end, they went down, and that is never healthy for a retailer. A retailer always wants to see rising comps.

DSW (NYSE: DSW) issued a pretty short press release detailing its Q4 earnings on Wednesday. Can't blame management about that. There really wasn't much to say, other than the data did not look appealing.

The footwear business reported a loss of 17 cents per share. In the previous year's Q4, there was a profit of 2 cents per share (I'm sure DSW is looking on that time period with bitter nostalgia). Unfortunately, the market was looking for a loss of only 12 cents per share according to this.

Nike, Inc. (NYSE: NKE) issued its Q3 numbers on Wednesday, and they were impressive in that they beat the analysts by quite the wide margin. According to Trey Thoelcke's earnings preview, analysts were looking for the sneaker giant to do $0.79 per share. Well, on an adjusted basis, excluding an impairment effect related to the Umbro asset, Nike delivered $0.99 per share. That represents an 8% jump in the bottom line.