Thursday, May 24, 2007

Nike 20 years ago (UA)

Under Armor (UA) has come on very strong, no pun intended, in the athletic apparel market and the momentum does not seem to be slowing. Founded in 1996 by Kevin Plank (a former college football player) Under Armor was designed with one purpose in mind, to design the perfect work out shirt. Today UA has a growing product line that includes not only apparel but cleats, sunglasses, duffel bags and an assortment of equipment. Here is a blurb from UA’s website:

“It started with a simple plan to make a superior T-shirt. A shirt that provided compression and wicked perspiration off your skin rather than absorb it. A shirt that worked with your body to regulate temperature and enhance performance.”

With a p/e ratio of 58 UA appears overpriced currently trading arouund $47, but if you can get in on a correction UA is a good stock to have in your portfolio. UA has a forward p/e around 38 and a quarterly revenue growth of over 40%. Like many growth stocks the short float is over 32% making this a very volatile stock. Trade this one carefully. Good analysis here. Nike and UA analysis here.

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