Under Armour’s [NYSE: UAA] stocks performed poorly in 2017 and to be honest 2018 is not looking any better.
And guess what?
Investors know this. Market sentiment about the apparel company is so low that it is practically non-existent.
Under Armour’s shares have declined over 45% in 2017 while competitors such as Nike [NYSE: NKE] have increased. The company’s underperformance and rising debt levels remained a concern.
The overvalued company has consistently revised its estimates down for 2017 and yet still managed to miss these estimates time and time again.
In a press release, management announced plans to restructure the company with the hope of having a better year, but I wonder does that include giving their CEO Kevin Plank the boot?
Kevin Plank, a PR nightmare, does more harm than good to the company’s bottom line. Between his comments regarding U.S President Donald Trump and his involvement in Plank Industries, I am starting to wonder if Plank is serving UAA’s best interest.
Assuming the new U.S. corporate tax reform benefits the company, it will be futile without a drastic change in leadership.
Don’t get me wrong, Kevin Plank’s vision stands to benefit shareholders long-term. However, the lack of aggressive growth and crumbling balance sheet makes investors itch to dump the stock.
Under Armour’s current focus on endorsements, acquiring fitness apps and restructuring leaves the entity unable to challenge both the rising Adidas and the dominant Nike.
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