There are good arguments on both sides here. I have to agree that they have built a quality brand and demand here but a PE of 32 for an underwaer co. seems high to me. If it gets to mid-20's I will start picking away at it
>>In general, how many people out there have changed their spending habits in the last 6 months?
We have just witnessed one of the largest credit implosions in history and it is going to continue well into this year. You really think that everything is going to be back to business as usual for the overleveraged, home-equity loan drawing US consumer?
You know why no one has changed their spending habits? Because they are the same people who thought their mortgage rates would be staying at the teaser rate forever.
I agree 100%. And yes, in tough times, its the big screen TVs and IPODs that may take a hit not athletic wear.
In general, how many people out there have changed their spending habits in the last 6 months? If you lose your job or your house, absolutely but how many eat out less, or drive less than they did 6 months ago? I'm not rich but I know I haven't changed anything and I have to think most others are the same way.
I believe Wal-Mart has held up just fine.....and no I'm not saying UA is WMT, but UA has been more than cut in half. We saw HD and SHLD put up terrible numbers recently and the stocks didn't move because the bad news was already priced in.
Repriced? Is 73 to 33 not a repricing in your book. The shorts can sit on this all they want but they will get called out eventually when this thing rallies again. It did it from 25 to 45 and it will do it again from 33 to 50. Even in a completely crappy retail environment UA will grow 25% this year. For those who say it shouldn't garner a premium valuation are seriously discounting the brand awareness and strength in the marketplace. UA is not a fad, there are so many avenues that this Company can go. To see Nike try to come in and compete with UA in the training market is a testament to the fear that Under Armour has put in the executives in Nike. You watch TV, Friday Night Lights, ESPN, high school sports, etc, all you see is UA, not Nike. They have done an amazing marketing job with this Company and they have great products to go along with it. They are hitting the target audience young and early. UA is committed to competing with the Nike's and Adidas's of the world and plans on doing so for a long long time. For this stock to be trading close to where it was when it IPO'd is crazy. The EBITDA and earnings of this Company have doubled in the past two years, no reason the multiple should be halved. I suggest everyone re-evalute why they are short, other than to play along with the gang mentality. I realize that the consumer is strapped with soaring housing and gas ocsts, but the first things to be cut back on are going to be the TV's, IPODs and video handsets. We live in a healthier society where people want to work out and look cool and good while doing it. The demographic trends are there for this Company.