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#1 SportsGuy

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Posted 13 May 2020 - 11:27 AM

https://twitter.com/...8869372928?s=21

#2 BSLChrisStoner

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Posted 13 May 2020 - 11:28 AM

BBJ: 'ALMOST EVERYTHING IS AT STAKE HERE' Will Under Armour survive the pandemic?
https://www.bizjourn...will-under.html



#3 JeremyStrain

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Posted 13 May 2020 - 11:34 AM

They were hurting before the pandemic. Tracked them all throughout my grad program, but last year after the Plank stuff, things were trending really south.

 

Hoping they pull it together, but they'll probably have to clean up and reorganize going forward.


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#4 Mike B

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Posted 13 May 2020 - 11:39 AM

UA does a lot of good things in the communtity.  I hope they are able to come out the other end of this pandemic, but many companies are going to fail.  Like a lot of things, this crisis is going to change the face of corporate Amertica.


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#5 weird-O

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Posted 13 May 2020 - 11:52 AM

I wonder how diversified Plank's various businesses are? I wonder if his other ventures are strong enough to help prop up UA, until things get back in order. 


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#6 NewMarketSean

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Posted 13 May 2020 - 06:39 PM

Never been a big fan of UA’s actual gear. Had some issues with pretty much everything I’ve owned from them. That said i like the prestige they bring to the area. I hope they don’t go under and I know a few folks that work there. Hope this doesn’t sink them.
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#7 RShack

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Posted 13 May 2020 - 09:54 PM

They were hurting before the pandemic. Tracked them all throughout my grad program, but last year after the Plank stuff, things were trending really south.

 

Hoping they pull it together, but they'll probably have to clean up and reorganize going forward.

 

I don't know about their balance sheet... but their stock has been a disaster ever since that one big sporting-attire etailer went belly up and took a huge share of UA's business down the toilet with them...


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#8 The Epic

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Posted 14 May 2020 - 08:20 AM

It's a classic case of getting too big and not adjusting for scale.

 

Within three years, they'll either be gone or back to a "boutique" like they used to be. They're gonna have to get out from under all those contracts.



#9 JeremyStrain

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Posted 14 May 2020 - 09:53 AM

I don't know about their balance sheet... but their stock has been a disaster ever since that one big sporting-attire etailer went belly up and took a huge share of UA's business down the toilet with them...


Yeah it got crushed. They were down 20-30% across the board the last time I did an analysis (YE 2018). Surprisingly their clothing line held up well better than other areas though. They will dump extra inventory to recoup at least a bit of what they spent vs getting stuck with stuff to places like TJ Maxx, etc. They get a pretty good deal cause those sell for more money than most at those stores. They took a big hit because of some intermingling with Plank's Cove project that shouldn't have happened (and was what led to him getting ousted as CEO), and because of some political opinion stuff. Last I had done research they were in the middle of voting on the Plank thing, now we know how that turned out, and they were hiring a new CFO. Was expecting with a new CEO and CFO they would change some things up and restructure a bit, but that hasn't happened yet. Maybe just waiting to see the fallout from this mess. I know they were talking about closing a LOT if not all of their retail shops (not outlets), but with their stock drop, they are afraid to look weak and lead to an even worse sell off.


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#10 JeremyStrain

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Posted 14 May 2020 - 09:56 AM

It's a classic case of getting too big and not adjusting for scale.

 

Within three years, they'll either be gone or back to a "boutique" like they used to be. They're gonna have to get out from under all those contracts.


They are diverse enough they should be ok honestly. They bring in a ton of money through their uniform deals, and they do a good job of recapturing old inventory in their own outlets, and what they don't sell from there they probably recoup another 50% from 3rd party stores like TJX etc. They don't lose as much on inventory as typical retail places do. Their sponsorship deals, and endorsement deals could lead to some issues if revenue is down this year, but I have a feeling they'll back out of some deals with sports that aren't playing and save some money for this year at least. Footware has been a steady loser for them lately, so maybe they cut back there for a while?


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#11 The Epic

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Posted 14 May 2020 - 10:36 AM


They are diverse enough they should be ok honestly. They bring in a ton of money through their uniform deals, and they do a good job of recapturing old inventory in their own outlets, and what they don't sell from there they probably recoup another 50% from 3rd party stores like TJX etc. They don't lose as much on inventory as typical retail places do. Their sponsorship deals, and endorsement deals could lead to some issues if revenue is down this year, but I have a feeling they'll back out of some deals with sports that aren't playing and save some money for this year at least. Footware has been a steady loser for them lately, so maybe they cut back there for a while?

 

I agree with a lot of this, but a lot of this is pretty much holding serve until things open back up. Once things continue to decline, they'll have some hard decisions to make. 

 

I didn't think about the recouping of the stuff they don't sell. That may buy them some time there. However if you're trying to survive into the mid-2020's, I'm not sure if just going full restructure/mass closing and just taking the bath on profits wouldn't be the move here. Blame coronavirus and move on. 

 

Serious question: Is the rev rec investigation wrapped up? If so I may have missed it but that's the big elephant in the room.



#12 JeremyStrain

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Posted 14 May 2020 - 10:47 AM

I agree with a lot of this, but a lot of this is pretty much holding serve until things open back up. Once things continue to decline, they'll have some hard decisions to make. 

 

I didn't think about the recouping of the stuff they don't sell. That may buy them some time there. However if you're trying to survive into the mid-2020's, I'm not sure if just going full restructure/mass closing and just taking the bath on profits wouldn't be the move here. Blame coronavirus and move on. 

 

Serious question: Is the rev rec investigation wrapped up? If so I may have missed it but that's the big elephant in the room.


Yeah, I mean those 3rd party places aren't purchasing anything for the past couple months, so this quarter is going to have some serious blowback as far as unusold inventory and down revenue. Not to mention it happened right during one of the coldest stretches of the year, and they lost out on a lot of their cold-gear sales. It's going to sting. They were already debating shutting down most of the brick and mortar, as they just don't do enough business in that front to justify the rent and overhead they are paying for them. Most of their retail sales come from Outlet sales (which aren't far off from their store prices anyway).

 

If they think they are going to bounce back after the virus, and keep those expenses on the books they are going to lose again. They went from like 20-50m in profit 3 straight years to LOSING 30m in 18, and 19 was on the same track. I'm sure the SEC 10k is probably done now for 19, I should pull it up and look. Mildly curious now.

 

No, it's still ongoing, but that's part of that project I was talking about too. It was mostly that he used company funds to fund that and some other projects that are his PERSONAL ones, and not under the UA umbrella.


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#13 The Epic

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Posted 14 May 2020 - 11:02 AM


Yeah, I mean those 3rd party places aren't purchasing anything for the past couple months, so this quarter is going to have some serious blowback as far as unusold inventory and down revenue. Not to mention it happened right during one of the coldest stretches of the year, and they lost out on a lot of their cold-gear sales. It's going to sting. They were already debating shutting down most of the brick and mortar, as they just don't do enough business in that front to justify the rent and overhead they are paying for them. Most of their retail sales come from Outlet sales (which aren't far off from their store prices anyway).

 

If they think they are going to bounce back after the virus, and keep those expenses on the books they are going to lose again. They went from like 20-50m in profit 3 straight years to LOSING 30m in 18, and 19 was on the same track. I'm sure the SEC 10k is probably done now for 19, I should pull it up and look. Mildly curious now.

 

No, it's still ongoing, but that's part of that project I was talking about too. It was mostly that he used company funds to fund that and some other projects that are his PERSONAL ones, and not under the UA umbrella.

 

Dude, I just looked at the 10Q. Looks like they already put a restructuring plan in place and took the bath. 

 

It's...it's bad. Almost a $300mm loss this quarter BEFORE restructuring costs.

 

https://www.sec.gov/...ua-20200331.htm


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#14 JeremyStrain

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Posted 14 May 2020 - 11:15 AM

Dude, I just looked at the 10Q. Looks like they already put a restructuring plan in place and took the bath. 

 

It's...it's bad. Almost a $300mm loss this quarter BEFORE restructuring costs.

 

https://www.sec.gov/...ua-20200331.htm


Eesh. Had a feeling. I did 2016-2018 during my grad program and the trends weren't good. That was BEFORE the investigation and the virus.

 

I think they are set up well enough to survive it, they just need to focus on what works and stop trying to grow TOO fast. It's not a coincidence that manufacturing and retail was opened up tomorrow...just saying. Ironically...they don't even manufacture here, it's all outsourced right now, but because they are listed as a manufacturing company, it frees them up to do more.


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#15 Pedro Cerrano

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Posted 14 May 2020 - 11:16 AM

So, Kevin Plank buying the Orioles thing and calling it "Under Armour Field".....


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#16 The Epic

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Posted 14 May 2020 - 11:27 AM


Eesh. Had a feeling. I did 2016-2018 during my grad program and the trends weren't good. That was BEFORE the investigation and the virus.

 

I think they are set up well enough to survive it, they just need to focus on what works and stop trying to grow TOO fast. It's not a coincidence that manufacturing and retail was opened up tomorrow...just saying. Ironically...they don't even manufacture here, it's all outsourced right now, but because they are listed as a manufacturing company, it frees them up to do more.

 

Once we get more detail of the restructure plan (this 10Q literally came out Monday), I think the stock price will reflect how good of an idea that people think it is. It took a huge dip right when the Q got released, but I think it might level off once they get in front of some cameras and discuss the actual circumstances of the plan. We'll see. The point is that they need to downsize personnel and close stores. And it needs to be massive.

 

I absolutely think that Under Armour played a role in the next-level opening up of Maryland. All of the largest employers here did. Hopkins has been banging that drum behind the scenes for weeks because they don't want to furlough their top talent and send people back overseas.



#17 JeremyStrain

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Posted 14 May 2020 - 11:42 AM

Once we get more detail of the restructure plan (this 10Q literally came out Monday), I think the stock price will reflect how good of an idea that people think it is. It took a huge dip right when the Q got released, but I think it might level off once they get in front of some cameras and discuss the actual circumstances of the plan. We'll see. The point is that they need to downsize personnel and close stores. And it needs to be massive.

 

I absolutely think that Under Armour played a role in the next-level opening up of Maryland. All of the largest employers here did. Hopkins has been banging that drum behind the scenes for weeks because they don't want to furlough their top talent and send people back overseas.


Agreed. Really savvy people may be waiting to poach some really down stock and then wait for it to bounce back after restructures too. The question is really how people will receive it and if it takes another drop first.

 

Yeah I was just telling my wife that. If people think it's a coincidence the two things he focused on first were both areas of UA's you're lying to yourself.

 

Funny story about Hopkins...they were running out of space recently, and told doctors in other departments that they may have to take shifts in the Covid floors. Some of them balked,  I mean they are tops in their field for the whole country, they've got some sway. And they were told if you don't do it, you will be furloughed and let go. I was waiting for one of them to do it and then file a suit for trying to force them to work in an unsafe work environment and win.

 

Surprised that hasn't happened in some other field where the company was like we are "essential" you are coming into work. If my wife had contracted it when there was ZERO reason she needed to be there I would have sued the hell out of the county. Someone is going to get paid for taking risks with people's lives. I mean hell, Hogan is being sued for NOT taking risks with people's lives.


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#18 The Epic

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Posted 14 May 2020 - 12:41 PM

Funny story about Hopkins...they were running out of space recently, and told doctors in other departments that they may have to take shifts in the Covid floors. Some of them balked,  I mean they are tops in their field for the whole country, they've got some sway. And they were told if you don't do it, you will be furloughed and let go. I was waiting for one of them to do it and then file a suit for trying to force them to work in an unsafe work environment and win.

 

Surprised that hasn't happened in some other field where the company was like we are "essential" you are coming into work. If my wife had contracted it when there was ZERO reason she needed to be there I would have sued the hell out of the county. Someone is going to get paid for taking risks with people's lives. I mean hell, Hogan is being sued for NOT taking risks with people's lives.

 

I think Hogan gets sued for reopening (WHILE being sued for not opening, LOL) before this is over and done with for the reasons that you just noted. Might not be fair, but it'll happen. 

 

Most companies have been very shrewd about avoiding COVID liability once they make people go back to work, but governments are kinda left naked here. Hogan won't be the last person to deal with this.



#19 Pedro Cerrano

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Posted 14 May 2020 - 03:24 PM

This could be bad for MD.

 

They have hitched their wagon to the whole "Oregon of the East" with UA being Nike.

 

Today people were calling into the Junkies calling UA "uncool dad clothes" and that it stood for "Un athletic"

 

If UA starts to get a bad rep, that could keep players away.  Merchandising matters.  Swag matters.


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#20 BSLChrisStoner

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Posted 04 May 2021 - 07:59 AM

BBJ: Under Armour continues recovery, beats Wall Street expectations in first quarter
https://www.bizjourn...jRKjzDbhRbYp0BA

 

The first quarter marks the first time Under Armour has achieved year-over-year growth of at least 20% since the third quarter of 2016.






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