Under Armour Voting Rights Trading At An Irrational Premium
Benjamin Kwasnick • 33 Comments
Benjamin Kwasnick • 33 Comments
Wed, Jun. 8, 12:30 PM
Tue, Jun. 7, 10:52 AM
- Under Armour (UA +0.7%) launched its first mobile app today with the unveiling of UA Shop on Apple's App Store. An Android version is expected shortly.
- The UA Shop app will create an unified user profile that will sync across other Under Armour connected fitness apps and tools (including acquired properties).
- Sector watch: UA Shop and Nike's SNKRS apps present a bit of showrooming risk for Foot Locker (FL), Finish Line (FINL -0.3%), and Dick's Sporting Goods (DKS +0.4%) - although the retailers have maintained that they have selling strategies to diminish the impact.
Fri, Jun. 3, 10:51 AM
- The board at Under Armour (UA -0.4%) approved a $59M dividend for Class C shareholders as part of a legal settlement tied to the creation of the class.
- Shareholders of record on June 15 are set to receive .007098 shares of Class C stock on June 29 for each full share held, although the final distribution rate could change.
Thu, Jun. 2, 12:41 PM
- While the Golden State Warriors look to repeat as NBA champions in their rematch with the Cleveland Cavaliers, retail analysts will have their eyes on the shoe match-up behind the game with star endorsers Stephen Curry and Lebron James on the big stage.
- Slice Intelligence provides the preview of the Nike (NYSE:NKE) vs. Under Armour (NYSE:UA) contest with these data nuggets tipped to Seeking Alpha.
- Sales of LeBron shoes outpaced Stephen Curry varieties in Q1 (7.27% LJ vs. 7.20% SC in January, 4% vs. 2% in February, 9% vs. 7% in March). Curry reversed the trend in Q2 (4% vs. 5% in April and 5% vs. 7% in May).
- While Curry doesn't have a lot of help on the UA roster, Nike and James are still leaning heavily on the MJ factor. Looking at sales of the top four NBA player sneakers, 75% purchased online have been Nike’s Air Jordan, followed by Kobe’s Nike shoe (14%), LeBron (6%), and Under Armour’s Curry One/Two (5%).
Thu, Jun. 2, 10:05 AM
- Under Armour (UA +1.2%) names designer Tim Coppens as the executive creative director for the upcoming Under Armour Sportswear collection.
- The well-known Coppens has introduced lines previously at high-end retailers such as Barney's
- The company is making a stronger push into fashion with the Under Armour Sportswear line which will debut this fall through its own website, select UA stores, and other high-end retailers. UAS was described to Racked.com as "fashion-driven performance sportswear."
Wed, Jun. 1, 7:45 AM
- Jefferies sees the Sports Authority bankruptcy as only a minor short-term bump in the road for Under Armour (NYSE:UA) which is still in the "early innings" of its extended growth story.
- Though the long-term call on UA from the investment firm is positive, analyst Randal Konik lowers the price target to $42 from $45 and maintains a Hold rating on a 12-month view.
- Previously: Under Armour issues warning due to Sports Authority's bankruptcy; shares lower (May 31)
- UA -2.79% premarket to $36.65.
Tue, May 31, 4:58 PM
- Citing The Sports Authority's bankruptcy filing and planned asset liquidation, Under Armour (NYSE:UA) now expects 2016 revenue of $4.925B (+24% Y/Y), below prior guidance of $5B and a $5.03B consensus. 2016 op. income guidance has been cut to $440M-$445M from $503M-$507M. The company notes it was "only able to recognize $43 million of the originally planned $163 million in revenues with The Sports Authority for 2016."
- Q2 revenue is still expected to be up by a high-20s % Y/Y. However, due to a $23M impairment charge related to The Sports Authority, op. income guidance has been cut to $17M-$19M.
- UA -3% after hours to $36.60.
Tue, May 24, 6:01 PM
- Under Armour (NYSE:UA) ended the day 2.6% higher as investors showed enthusiasm over the company signing the largest college athletics apparel deal in history.
- The company will pay out an average of $16.67M a year for a period of 15 years. The contract begins in July of 2017.
- UA has now signed deals with three teams out of the Pac 12 conference (Utah, UCLA, Cal) in a clear strategy to increase its exposure on the West Coast. CEO Kevin Plank confirmed as much to the Los Angeles Times, saying "it was important for us to plant our flag in L.A.”
- On Wall Street, Sterne Agree Sam Poser called the deal expensive before adding that sponsorship deals really do increase the power of the brand.
Tue, May 24, 11:18 AM
- Under Armour (UA +2.3%) is about to sign the largest sponsorship deal in college athletics history, according to ESPN's Darren Rovell.
- Sources tip that a 15-year apparel and shoe deal with UCLA will be worth $280M. UCLA has been with Adidas since 1999.
- Baltimore-based Under Armour has made a big push on the West Coast with the ink still drying on a deal with the University of California.
- Nike (NKE +0.7%) has signed heavyweights University of Texas ($250M) and Ohio State ($252M) within the last seven months.
Mon, May 23, 10:27 AM
- The U.S. footwear industry is expected to be big winner from the Trans-Pacific Partnership trade agreement, according to analysis from the U.S. International Trade Commission.
- U.S. footwear imports are expected to increase by 2.7% or $1.1B vs. the 2032 baseline growth estimate, with the bulk coming from Vietnam at the expense of China.
- Exports from the U.S. are seen increasing 12.2% as more parts are sent to Vietnam for final assembly.
- TPP is anticipated to have a positive impact on U.S. output and footwear-related employment levels.
- Footwear is the sector with the largest positive benefit from reduced tariffs in what could be a favorable development for margins.
- Full U.S. ITC report (.pdf)
- Related footwear stocks: DSW, SHOO, FINL, FL, UA, SCVL, UA, NKE, OTCQX:ADDYY, DECK, WWW, SKX.
Fri, May 20, 9:37 AM
- Nike (NKE -1%) and Under Armour (UA +0.4%) are on watch after Foot Locker posts comparable-store sales growth well below estimates (+2.9% vs. +4.5% expected) for Q1.
- A big part on how to read the impact of the numbers on NKE and UA depends on what it means when Foot Locker says it "navigated well through a variety of challenges, not least of which were rapidly-shifting product-category preferences by our customers."
- Though both companies are selling more products directly to consumers (especially on the tech side), there's the question on if Foot Locker's sub-3% comp is a loss of market share or weakness in key footwear categories.
- Previously: Foot Locker lower post Q1 results (May 20)
Sat, May 14, 11:01 AM
- The retail sector stays in focus next week with Target (NYSE:TGT), Wal-Mart (NYSE:WMT), TJX Companies (NYSE:TJX), and Ross Stores (NASDAQ:ROST) all due to report on Q1 earnings to follow on a week of dismal reports and guidance from the department store sector (Nordstrom, L Brands, Macy's, Kohl's). Home improvement chains Home Depot (NYSE:HD) and Lowe's (NYSE:LOW) are also due to spill numbers.
- The story from the Commerce Department's April read of retail sales (+3.0% Y/Y, +1.3% M/M) is one of a consumer spending on housing, entertainment, and personal care/fitness over apparel and general merchandise. The 10% Y/Y gain in the nonstore retailer category also tipped that the Amazon (NASDAQ:AMZN) Effect is magnifying.
- Amplify ETFs CEO Christian Magoon tells Seeking Alpha that the traditional retail model appears to be broken. Amplify's Online Retail ETF (NASDAQ:IBUY) is a bet on companies such as Netflix (NASDAQ:NFLX), GrubHub (NYSE:GRUB), Blue Nile (NASDAQ:NILE), and Shopify (NYSE:SHOP) that are reeling in millennial dollars.
- Magoon on retail: "Traditional retailers face the headwinds of higher cost structures including the very real threat of increasing wages in the form of the $15 minimum wage campaign. Less flexible with inventory management, they also are more vulnerable to issues like weather and changing consumer preferences."
- Retail ETFs: XLP, XLY, VDC, XRT, VCR, RTH, RETL, FXG, PBJ, IYK, FXD, IYC, RHS, FDIS, PEJ, FSTA, PSL, SCC, RCD, UCC, PEZ, PMR, PSCC, UGE, PSCD, SZK, BITE.
- Apparel stocks: KATE, ANN, LULU, PVH, VNCE, CRI, UA, HBI, VFC, COLM, GIL, SQBG, JCP, KSS, DDS, M, JWN, ARO, AEO, ANF, WTSL, TLYS, CACH, ZUMZ, PSUN, EXPR, BKE, GIII, SQBG, HBI, VRA, ICON, SHOO, PERY, DXLG, BONT, GES, URBN, RL,GIL, NKE, OXM, HBI, VNCE, PERY, ICON, FL.
Wed, May 4, 8:04 AM
- Brean Capital cites execution risks in downgrading Under Armour (NYSE:UA) to Hold from Buy.
- Analyst Eric Tracy thinks the stock has very little room for error at current valuation which makes yesterday's news of a pair of executive departures a bit more sensitive.
- Another short-term risk for Under Armour is the liquidation process in the industry with several sporting good chains shuttering stores. That trend could pressure pricing as inventory is cleared.
- UA -2.76% premarket to $41.54.
Tue, May 3, 6:23 PM
- Under Armour (NYSE:UA) -1.4% AH on news it is losing its chief merchandising and chief digital officers, with no reason offered for the corporate shake-up.
- UA names Kip Fulks as interim chief merchandising officer, as Henry Stafford steps down in July after six years at the athletic apparel maker.
- UA also says Michael Lee, co-founder of MyFitnessPal, will serve as its chief digital officer starting in July, replacing Robin Thurston.
- Now read Under Armour: Time to board the crazy train? 5 reasons to pull the trigger on this high P/E stock
Tue, May 3, 3:36 PM
- Under Armour's (UA -2.4%) 10-year contract extension with Bryce Harper will be the largest endorsement deal for a baseball player in history, sources tell ESPN. Details on the signing weren't disclosed by the company.
- Under Armour originally signed Harper when he was in the minor leagues.
- The first signature cleat from last year's National League MVP, the Under Armour Harper One, is due out in July.
- Under Armour also plans to use Harper to advertise its connected fitness platform which makes sense with the U.S. baseball shoe market only a $200M business.
Mon, May 2, 1:16 PM
- Sole Collector posts pictures of Under Armour's (UA -0.8%) new Curry 2.5 basketball shoe products soon to be available to consumers.
- Golden State Warriors star Stephen Curry is expected to showcase the shoes again after his return to the playoffs from injury. The official release to consumers is scheduled for around May 28, a strategic date that is close to when the NBA Finals will start.
- The 2.5 and the next-edition Curry Three will be launched globally this summer and in the fall. The international push will include China where Under Armour is battling some brazen attempts to copy their products right down to the logo.
Under Armour, Inc. engages in the development, marketing and distribution of branded performance apparel, footwear and accessories for men, women and youth. It operates through the following geographical segments: North America, Latin America, Europe, the Middle East, and Africa. The company was... More
Sector: Consumer Goods
Industry: Textile - Apparel Footwear & Accessories
Country: United States
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