Financial Overview of Under Armour, Inc.

Financial-Under Armour is a publicly traded company on the NYSE. Results from the fourth quarter, ending December 31, 2011, shows that net revenues increased 34% to $403 million, $102 million more than

Under Armour’s (UA) current CEO Kevin Kant founded the company in 1996, which has witnessed the company grow in recent years to become a key player in the sporting gear and apparel industry. UA focuses its products and marketing efforts towards the youth, men, and women. The amount of resources that are allocated to each group of customers differs in that initially, UA primary source of revenue was from men even if youth and women products were also produced and sold. The specificity of UA’s products and their sporting activities selectivity can be attributed to UA’s limited global market share in the sporting gear and apparel industry. The company’s mission statement is inspiring, but in order to gain competitive advantages against larger

Over the past five years, although Under Armour’s Cost of Goods Sold (COGS) has increased in dollars spent, it maintains an average fifty-two percent of Net Revenues during the timeframe of 2011 – 2015 (“Under Armour Annual Report 2015,” 2015). Under Armour’s average COGS during this time is $1,308.157.00 (“Under Armour Annual Report 2015,” 2015). One of the materials Under Armour uses is cotton. The 2015 price of cotton has decreased to fifty percent of the 2011 calendar year average of $155.70 (“Monthly Prices – National Cotton Council,” n.d.). Crude oil, another material used in Under

When deciding between us and our competitors, when choosing which performance apparel producer you want to invest into, we know the marketplace for performance apparel, footwear and accessories is highly competitive and includes many new competitors as well as increased completion from established companies expanding their production and marketing of performance products (pg. 6, 10k). We believe we have been successful in competing with others for limited retailer floor space because of the relationships we have developed as a direct result of the strong sales of our products. Under Armour is the official sponsor of the National Football League Combine. They are also the official footwear supplier of Major League Baseball (5 Things You Didn’t

Under Armour Inc. is a Big Capital company, with $17.8 billion market capital. Its revenue in 2014 is $3,084 million, increase about 32.25% from $2,332 million in the fiscal year ended December, 2013.

The athletic footwear and apparel industry is extremely competitive but Under Armour has been able to establish a strong market share in the U.S. The industry is profitable and has a history of robust sales, profit growth, and solid credit metrics. The industry as a whole is believed to be more recession resistant than many consumer discretionary categories, because of lifestyle and the relatively low cost basis. The synthetic performance apparel market represents about a $3 billion market and presently, Under Armour is the leader with an estimated 60% of the market share. The activewear market as a whole is about a $58 billion market.

Under Armour is in the Textile- Apparel Clothing industry, in the consumer goods sector. The market has been driven by economic recovery, new product offerings and a

Consistency tends to be the best assets that Under Armour has to their advantage. According to Plank, he states that the success of a business, "starts with a good product," and he continued to say that after you have a good product, "use front-end hustle with back-end muscle." Due to this consistent product that Under Armour produces, it has obtained a heavy customer loyalty. Sales and revenue speak for themselves. In 1996, Under Armour had revenues of fifty thousand dollars compared to 200 million in 2004.

10. Based on a cost of equity of 5.31%, Under Armour created value in 2013 because the ROE (17.4%) is greater than the cost of equity (5.31%).

Under Armour strives to create products that help all athletes improve their game through “passion, design, and the relentless pursuit of innovation.” As a result, everything that Under Armour creates and sells, including accessories, apparel, shoes, and fitness products, serves a purpose. Whether it’s a t-shirt that keeps you cool during your workout or sneakers that

The first exposure is presented to Under Armour is their relationship with the overseas manufacturing partner. Shortages of raw materials, delays, and inefficiencies in the manufacturing process can disrupt the product launch. If Under Armour is going to make claims to deliver top notch equipment in a period of time, they have to rely on overseas communication, manufacturing and delivery to do so. There is a concern that the increases in the manufacturing costs can start reducing profit-margins. As seen over the past election debates,

Under Armour has infused their products and their brand image in various visual media forms, including over a dozen popular television shows and numerous motion pictures (Shank, 2009). The look and appeal of Under Armour was ideal as it was the combination of the intense, hard core athletic gear that could help with performance coupled with a hip, fresh look that would be able to appeal to consumers. To differentiate its product line from its competitors Under Armour leveraged its sophisticated design software, new manufacturing techniques, the latest in material engineering, and robust information technology systems to produce virtually everything it makes (Shank, 2009). The utilization of the marketing technique of product placement in television, movies, and video games has allowed Under Armour to promote the benefits of its product line to a larger audience (Shank, 2009). In 1998, Warner Brothers studio was

Under Armour is currently one of the leading companies in the sports apparel industry whose mission is to “Make all athletes better through passion, science, and the relentless pursuit of innovation”.1 When Under Armour first broke into the sports apparel industry it was a disruptive pioneer that initially made the two giants, Nike and Adidas, a little weary. Under Armour revolutionized the sports apparel industry by creating apparel that used synthetic materials as an alternative to natural fibers, such as cotton, or other materials, such as polyester. This all-important switch to these materials resulted in a 2“shirt that provided compression and wicked perspiration off your skin rather than absorb it. A

Under Armor is a new entrant into the Sports Clothing, Shoes, Accessories, Equipment and Service Industry. This industry is highly saturated and a challenging industry. The profitability of individual companies is determined by efficient manufacturing and effective marketing. (Hoovers). Large companies excel in economies of scale, and usually carry a wide range of products. The industry is concentrated: the 50 largest companies account for about 70 percent of industry revenue (Hoover).

On the other hand, Company A has net fixed assets of 19.6%, higher than Company B (14.9%), which probably because Company A has more equipments to support their robust research and development. Intangibles e.g. goodwill for Company B (46.1%) is higher compared to Company A (22.2%) because B focus more on their brand development.