Morningstar

Under Armour Inc Class A UAA

Morningstar Rating
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Stock XNYS Rating as of
$5.70 −0.08 (1.38%)
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As of Delayed Price Pre-Open: $5.72 +0.01

Company Report

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Under Armour Lacks a Competitive Edge, but Focus on Performance Athletes Provides Comeback Hope

David Swartz

We view Under Armour as lacking a moat, given its failure to build a competitive advantage over other athletic apparel firms. Between 2008 and 2016, the company’s North American sales increased to $4 billion from $700 million, and it passed Adidas as the region’s second-largest athletic apparel brand after Nike. However, Under Armour’s North America sales have barely grown over the past decade due to challenges from established competitors and new entrants. CEO Kevin Plank has been focused on developing technical products for athletes (primarily aged 16-24) to improve results, but tangible signs of progress have been elusive.

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Price vs Fair Value

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UAA is trading at a 43% premium.
Price
$5.70
Fair Value
$41.60
Uncertainty
Very High
1-Star Price
$23.18
5-Star Price
$4.37
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

CEO Kevin Plank is taking Under Armour back to its roots by focusing on core men’s performance apparel, the North America sportswear market, faster product development, and less discounting.

Bears

Under Armour has gone through years of restructuring and strategic plans but continues to struggle with inconsistent sales growth and profitability.

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News

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Trading Information

Previous Close Price
$5.78
Day Range
$5.66–5.80
52-Week Range
$4.13–8.15
Bid/Ask
$5.51 / $5.92
Shares Outstanding
426.32M
Market Cap
$2.43B
Volume/Avg
2,815 / 9M

Key Statistics

Price/Earnings (Normalized)
48.17
Price/Sales
0.50
Dividend Yield (Trailing)
0.00%
Dividend Yield (Forward)
0.00%
Total Yield
1.04%

Company Profile

Under Armour develops, markets, and distributes athletic apparel, footwear, and accessories in North America, Asia-Pacific, Europe, and Latin America. Consumers of its performance-based clothing and shoes include professional and amateur athletes, sponsored college and professional teams, and people with active lifestyles. The company sells merchandise through wholesale partners, company-owned digital channels, and approximately 440 company-owned outlet and full-price stores. The Baltimore-based firm was founded in 1996 and is led by controlling shareholder Kevin Plank.
Sector
Consumer Cyclical
Industry
Apparel Manufacturing
Stock Style Box
Small Core
Total Number of Employees
14,100
Website
https://www.underarmour.com

Competitors

Valuation

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Metric
UAA
PUM
ADDYY
Price/Earnings (Normalized)
 48.1727.2220.33
Price/Book Value
 1.742.125.01
Price/Sales
 0.500.561.18
Price/Cash Flow
 227.87—11.23
Price/Earnings
UAA
PUM
ADDYY

Financial Strength

Metric
UAA
PUM
ADDYY
Quick Ratio
 0.590.490.57
Current Ratio
 1.621.271.35
Interest Coverage
 −5.63−5.866.68
Quick Ratio
UAA
PUM
ADDYY

Profitability

Metric
UAA
PUM
ADDYY
Return on Assets (Normalized)
 1.07%−6.89%7.29%
Return on Equity (Normalized)
 2.93%−22.76%25.80%
Return on Invested Capital (Normalized)
 2.17%−8.66%14.34%
Return on Assets
UAA
PUM
ADDYY

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