Nike Vs Under Armour Financial Analysis

Nike’s target market for their shoes, clothes and other accessories are males and females between 18 and 35 years old. Nike’s Competitive market has expanded and dominated in the international market. Nike disburses TV ads during professional and college sports events, prime-time programs, and late-night TV programs. A financial analysis helps us compare a company’s current performance with its past performance Gives us an idea of how the entire industry is performing as well as liquidity ratios, profitability ratios, and leverage ratios will give us a good understanding of how Nike, Adidas Group, and Under Armour are performing.

Competitors in the industry can wreak havoc on the bottom line for a company. With rivals, a price competition usually ensues, which benefits the customers but hurts the competing businesses that share a common strategy. In reviewing rival sellers, many competitors exist within the sports apparel and footwear industry, but most of them are unable to compete with the industry giants, Nike and Adidas. They are well seated in the industry and their sales reveal this ultimate strength, however, Under Armour is putting pressure on these mammoths. In 2015, global sales of sports clothing and footwear equated to $250 billion, of which Nike grabbed $30.6 billion, Adidas held in its grasp $18.8 billion and Under Armour had a much smaller piece of the pie, at $3.9 billion globally. In reviewing these numbers, it looks like Under Armour is really subpar to the industry giants, but this is not exactly the case. Under Armour in the past couple of

There were some significant differences in the two company’s statements. For example, Nike incurred a net loss of $60.6 million from their operating activities where as Under Armour experienced a $69.52 million gain. Another significant figure is the difference in the total cash dividends paid. Over the course of the year, Nike paid $412.9 million in cash dividends where as Under Armour paid no cash dividends during the year. However, when it came to the cash balance differences between 2008 and 2007, Nike increased its cash by $277.2 million where as Under Armour only increased its cash by $61.45 million.

Nike is one of the biggest regular apparel brands in the world.Nike is ranked number one in apparel brand, as of 2015. Nike beat Jordan at number three, and Adidas at number four. Plus beating other big apparel companies such as: Converse, Ralph Lauren, Under Armour and

Under Armour has proven year over year that they are indeed a growth company. As their brand recognition and product availability increases so do their revenues. Under Armour achieved a growth in net revenue by over 18 percent, increased net income by 22 percent (suggesting financial discipline) all leading to their ability to sustain growth year over year (Under Armour 10K, 2009). This considerable increase in net revenue is attributed to an increase in apparel and the introduction of footwear in the first quarter of 2009 (2009). Although Under Armour has only been around 14 years they have only been traded publicly since 2005 (2009).

At some point in one’s life, he or she gets introduced to sports which have become a staple in society around the world. For example, most countries have a national team for different sports such as soccer, volleyball, and baseball. There are many companies like Addis, Reebok, and Asics that produce sportswear for every sport imaginable. Two of the biggest sportswear companies are Nike and Under Armour. Athletes and non-athletes all over the world use Nike and Under Armour products every day.

sponsors. Nike's market cap is $98 billion and Under Armours market cap is $22 billion. Nike

However, there also have been other executives who have helped the organization to still leading the market. For many years, although Nike has had a lot of competitors, they have managed to control the market share in an excellent way. Under Armour for example, is a direct competitor of Nike and even though is newer company than Nike, they have shown to be a strong competitor. Also, Under Armour has been able to make presence in some of the biggest sports name, their brand has grown and their style clothing is distinct and unique. Apart from Under Armour, Reebok is another brand that is a direct competitor of Nike. Many brands actually struggle to be on top for Nike, but because of the efforts, talent and undeniable innovation, Nike will be ahead of them for years to

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.

Nike has been around since 1968 so they are a much more established company than Under Armour. They are a bigger brand than Under Armour and they have been able to sustain and grow that brand over time. The Nike swoosh logo is one of the most popular and easily recognizable logos currently out there. The Under Armour interlocking U and A is a very successful logo too, but it is not quite on the same level as the Nike swoosh yet. According to the case in the textbook, in 2011-2012, Nike had over 1,000 professional athletes with endorsement contracts. It’s going to be tough for anybody to knock off Nike as the market leader in the near future with numbers like that. Adidas is another strong competitor as well. They have several strong components of their business such as Reebok and Rockport. Perhaps their biggest strength is how wide spread their business is across the world. Puma is a big competitor for Under Armour in the athletic footwear business. Polo Ralph Lauren is also a major competitor in the performance activewear business. According to Exhibit 1, the level of rivalry among existing competitors is

Overall, Nike’s inventory turnover is greater than Under Armor by .86%. This leads us to believe Nike is selling more inventory than Under Armor and making a greater profit. Nike’s annual sale’s are 8.4 times greater than Under Armour’s, which leads them to have an extra advantage because they have more money to spend on marketing, and advertising (Sparks). Not only that, the current ratio of Nike is 2.52% and Under Armour is 3.67%. Even though Under Armour has a higher ratio, Nike is also competently larger in size than Under Armour so has more current liabilities, but Nike, for its size is still has a comparable current ratio.

Other competitors include Reebok, Asics, Puma, Adidas, and FILA. Under Armour’s biggest competitor, Nike, whose gross revenues of $25.3 billion vastly overshadow Under Armour’s $1.8 billion. One positive trend for Under Armour from a competitive standpoint is the fact that their competitors may have reached their maximum potential. Nike’s 12-Month Revenue Growth was 4.9% , while Under Armour had a rate of 24.6% (Colbert, 2013). Nike is booming in production but Under Armour is on the rise and will eventually take over the athletic

Nike, Adidas and Under Armour are the largest brands in the athletic/sportswear monopolistic market. As of 2015, Nike’s revenue was $30.1 billion, the revenue of Adidas was $4.57 billion, while Under Armour’s revenue was $3.96 billion. Though all of the companies are large, Nike has a little more than 60% of the brand share dollars as compared to Adidas’ 11% and Under Armour’s 7% (Figure 1). Nike has some major strategies that

Under Armour provides sports clothing, casual apparel and footwear. It faces intense competition from Nike, Adidas, and Puma.

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