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Author Topic: Thinking about investing in UAA  (Read 524 times)

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arbass23

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Thinking about investing in UAA
« on: January 18, 2017, 01:59:36 pm »

I am thinking about investing in UAA, wanted to see what you guys think of this. It is at 5yr low of 29.20. Would just like to hear you guys thoughts on it.
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BigBrandonAllenFan

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Re: Thinking about investing in UAA
« Reply #1 on: January 19, 2017, 03:09:08 pm »

I'm not any kind is specialist on individual stocks, preferring the safer mutual funds. But I did look at the UAA charts. Frankly, I read it as a flattened out stock. About 8 months ago the stock indeed nose dived to an all time low, and has only trickled slightly more downward since then. The major problem for UAA is the fact that Nike has 8 times the sales of UAA. Couple that with the sharp increase in Jordan apparel sales, UAA's back is pinned against the wall. Speaking for myself and my 15 y/o son, if it doesn't have a Nike check or a Jordan logo, we don't wear it.  We have a ton of sportswear, and none of it is UAA.  As I sit here now, I'm wearing a Nike shirt, a Nike jacket, a pair of Nike sports pants, and a pair of Jordan shoes.  Of course I'm not everyone, but the fact I spend a couple of grand on Nike in a year, and none on UAA does say something for the averages. UAA's quick rise and subsequent sudden fall makes the line appear to be more of a passing fad than a long term hardcore top shelf player. I would classify UAA as being in a class less than Addidas. The fact the chart line has ran very flat for nearly a year would steer me away from investing. I may be wrong.
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arbass23

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Re: Thinking about investing in UAA
« Reply #2 on: January 19, 2017, 03:34:30 pm »

Thanks for your input, and time you put in to research. I will have to do more research on it. I guess I am just the opposite of you I wear all Under Armour sports wear, hunting clothes , and even my work shirts are Under Armour. Maybe I was letting that cloud my judgment. Once again thanks for your input, I am new at this an learning.
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BigBrandonAllenFan

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Re: Thinking about investing in UAA
« Reply #3 on: January 19, 2017, 05:17:47 pm »

Thanks for your input, and time you put in to research. I will have to do more research on it. I guess I am just the opposite of you I wear all Under Armour sports wear, hunting clothes , and even my work shirts are Under Armour. Maybe I was letting that cloud my judgment. Once again thanks for your input, I am new at this an learning.

You are welcome arbass.  It gives me an opportunity to research.  There is no such thing as too much market education for the investor.  Like I said, I may prove wrong on the stock.

I do pay strict daily attention to the markets and their trends, as you may see
 by my participation in this forum.

If you will Google "UAA stock", you can see where I am coming from on the read of the chart.  If you look, there was a steep drop after Christmas of 2015, which says holiday sales didn't live up to expectations, and with the holiday season of 2016 there was no upswing, and when holiday sales are weak or flat with apparel lines, it is not a good sign.
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HawgWild

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Re: Thinking about investing in UAA
« Reply #4 on: January 31, 2017, 09:17:43 am »

Did you pull the trigger on your UAA purchase?
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arbass23

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Re: Thinking about investing in UAA
« Reply #5 on: January 31, 2017, 09:59:43 am »

No, thanks to BigBrandonAllenFan I didn't. I decided to put my money into MMP and it is up about 4% so far.
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ricepig

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Re: Thinking about investing in UAA
« Reply #6 on: January 31, 2017, 10:13:04 am »

Did you pull the trigger on your UAA purchase?

Yeah, I thought of this when I was walking earlier and noticed it had taken a nose dive.
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BigBrandonAllenFan

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Re: Thinking about investing in UAA
« Reply #7 on: February 09, 2017, 11:22:23 am »

No, thanks to BigBrandonAllenFan I didn't. I decided to put my money into MMP and it is up about 4% so far.

Good thing you ditched UAA or so it looks..  UAA seems to be in a pile of dog poop that is only getting deeper by the day it appears...

The very day that Megan Kelly went south on Trump, I started a thread over in the Think Tank at SECFanatics predicting Megan was soon to be out at Foxx News. http://www.secfanatics.com/vbulletin/showthread.php?t=105539&highlight=
About 2 months later, Megan was gone, and most people believe it wasn't her choice, but Foxx gave her an avenue out without making it appear to be a firing, which in all reality it was a firing.

Now Curry is singing the opposite song as his boss at Under Armour, as the Under Armour CEO is praising Trump's economic policies and Curry is taking the quoted context of the CEO and reforming his words. I'm thinking Curry is soon out at Under Armour.

Dangerous move on Curry's part as for endorsement franchising.

Quote
Stephen Curry has pointed reaction to Under Armour CEO’s praise for Trump

By Mike Murphy
Published: Feb 9, 2017 10:37 a.m. ET


Safe to say the NBA superstar is not a big fan of the president

NBA star Stephen Curry had a sharp response Wednesday after Under Armour Inc. Chief Executive Kevin Plank called President Donald Trump an “asset” to the country:

‘I agree with that description ... if you remove the “et” from asset.’ Stephen Curry

Curry, the Golden State Warriors’ two-time NBA MVP, has an endorsement contract with Under Armour running through 2024 that’s reportedly worth more than $4 million a year.

On Tuesday, Plank told CNBC that Trump was good for American business. “To have such a pro-business president is something that is a real asset for the country,” he said. On Wednesday, the company released a statement that stressed it was focused on business issues, not Trump’s more controversial actions. “We engage in policy, not politics,” the statement said.

In an interview with the San Jose Mercury News, Curry said he was surprised that Plank had praised Trump, but he said that didn’t mean he would leave the sneaker and apparel company — yet. “It’s a fine line, but it’s about how we’re operating,” Curry said, “how inclusive we are, what we stand for.”

But Curry said he would leave if that line were crossed. “If I can say the leadership is not in line with my core values, then there is no amount of money, there is no platform I wouldn’t jump off if it wasn’t in line with who I am.”

Alienating Curry would be a disaster for Under Armour UAA, at a time when it can scarcely afford one. Under Armour’s stock suffered a number of downgrades in the past week after disappointing earnings. The company’s shares are down more than 30% in the past month and are down almost 73% in the past 12 months.

Curry is the company’s most important athlete endorsement, with Morgan Stanley pegging his value to Under Armour at $14.1 billion in 2016.

ALSO now from MarketWatch today: http://www.marketwatch.com/story/under-armours-sole-bond-issue-downgraded-to-junk-status-2017-02-03

Quote
Under Armour’s sole bond issue downgraded to junk status

By Ciara Linnane
Published: Feb 9, 2017 7:22 a.m. ET


S&P cited competitive and pricing pressures, as well as weak operational execution by the company for its ratings action

Under Armour bonds are now junk rated.

Under Armour stock was subject to a slew of downgrades this week after a disappointing earnings report and news of the departure of finance head Chip Molloy after just one year on the job.

The bad news didn’t end there.

The sports equipment and apparel retailer UA, also had its credit downgraded, sending its sole bond issue into speculative, or “junk” territory.

Standard & Poor’s cut its rating on the issuer to BB-plus from BBB-minus, the last level of investment grade. The outlook on the rating is negative, meaning S&P could lower it again in the medium term.

Under Armour, best known for performance sports gear, is rolling out a collection of high-end clothing including jackets, trousers and trench coats. The company aims to reach what it calls 'ambitious millennials.'

The rating agency said increased competition, pricing pressures, a weak retail environment, weak operational execution by the company and higher costs to support growth were behind the action.

“We now believe the company will generate about 10 percent sales growth annually and margins will be in the 12 percent range, which results in leverage slightly below 3 [times],” said S&P analyst Mariola Borysiak.

Another ratings agency, Moody’s maintained its Baa2 on Under Armour after the earnings report, but revised its outlook to negative from stable. Baa2 is two notches above junk in Moody’s scale.

Under Armour reported sales of $1.31 billion for the quarter, missing the $1.41 billion FactSet consensus. Earnings per share of 23 cents were also below the 25-cent FactSet consensus.

Read: Millennial shoe shoppers are clamoring for these fashion staples of the ’60s and ’70s

“In the fourth quarter, slower traffic caused significant promotional activities, earlier, deeper and broader than expected,” Chief Executive Kevin Plank said on the call, according to a FactSet transcript. “This in addition to higher demand for more lifestyle silhouettes caused us to be out of balance with our assortment. So we lost top line volume as we [worked] to adapt through our mix and pricing.”

Under Armour’s only outstanding bonds, the $600 million of 3.250% notes to mature in June of 2026 were last quoted at 91 cents on the dollar, according to MarketAxess.

The stock was flat Friday, but is down 28% in the year to date, while the S&P 500 SPX, +0.60%   is up about 3%.



« Last Edit: February 09, 2017, 11:36:37 am by BigBrandonAllenFan »
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Vantage 8 dude

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Re: Thinking about investing in UAA
« Reply #8 on: February 13, 2017, 04:51:27 pm »

I am thinking about investing in UAA, wanted to see what you guys think of this. It is at 5yr low of 29.20. Would just like to hear you guys thoughts on it.
For what's it's worth I'm a retired Financial Advisor with over 35 years of investment experience handling primarily individual personal/retirement monies so with that background I'll give you my two cents. There's an old saying of "being careful of trying to catch a falling knife". In other words, just because a stock is cheap and at or near a low doesn't make it a good investment. This stock has some major problems. Not only are its sales and earnings diving but just as importantly, a number of very key officers have abandoned ship over the past year or so. As you may have seen their CFO announced he was leaving after only about a year on the job. As mentioned previously, this is NOT the first desertion. While Under Armor has definitely gained traction over the past few years in the sports wear and athletic gear arena, there is especially fierce competition in this area. One last thing: after a stock like this has been battered and beaten up I've made a habit of counseling my clients that they need not jump at the first sign of stability in a stock's price (not convinced we're even there yet). Remember a very basic rule that a stock can't go up until it stops going down. As simplistic and basic as that may seem, it's a good thing to remember. IF and WHEN a stock has put in a true price bottom it will typically trade side ways or in a fairly tight range for a while. It will also tend to hold its previous low price levels on any addition sell offs and gradually begin to make incremental short term highs. In other words, there is plenty of time to buy this stock at some point in the future; I seriously doubt you have to worry that you'll miss this stock's sell off. That's especially true if you're looking to make this a serious investment, not just a trade.

Hope this helps. Good luck in all your future investment decisions.  :D
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