Under Armour - Financial Analysis

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Date Submitted: 05/04/2010 09:39 PM

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Under Armour, Inc (NYSE: UA)


Under Armour (UA) is based in Baltimore, Maryland and is a developer and retailer of performance apparel, footwear and accessories for athletic use. Under Armour was started in 1996 by former University of Maryland football player Kevin Plank with the belief that athletes needed a good alternative to the basic cotton t-shirt for their workouts. After working with multiple fabric companies to develop an advanced moisture wicking fabric, Mr. Plank began selling tight-fitting base layer tops and bottoms from his corporate headquarters in his grandmother’s basement. Twelve years later, Under Armour has grown into an internationally recognized leader in high performance athletic clothing. Net incomes have grown exponentially since the company’s inception.

Under Armour has fed this growth with strategic partnerships with the NFL, college football teams, and numerous star athletes. The company has moved beyond its initial base layer clothing meant to be worn “under armour.” Under Armour now produces clothing, footwear, and accessories for baseball, golf, cross-training, military/tactical use, hunting, and assorted other athletic or outdoor disciplines. Dedicated displays at large retailers such as Dick’s Sporting Goods and Sports Authority and Under Armour retail outlets are helping to grow the brand and its dedicated customer base.

Under Armour revolutionized the world of athletic wear and created products that are considered a necessity to increase comfort and performance during athletic training. With this massive success comes a massive price -- Under Armour has drawn the attention of athletic apparel and footwear leaders, most notably Nike. With Nike’s sheer size and resources, it is truly a case of David vs. Goliath. Under Armour does not own any fabric or process patents at the moment, so it is relatively vulnerable to competition from larger corporations that...