The document analyzes Under Armour's valuation. It finds that while UA has experienced high growth, its growth rates are unsustainable in the competitive sports apparel market. The analysis values UA at $68 per share, lower than the market valuation of $84 per share, due to overestimation of UA's expansion potential internationally and in new products. UA's current growth is driven by women's apparel, footwear, and international markets, but it faces risks from limited brand recognition and dependence on third parties for manufacturing.
This project includes the business information about Under Armour, Inc. It demonstrates the mastery of analyzing the current financial position of a company and predicting the future growth.
Under Armour has an opportunity to grow through introducing a customization platform. Their marketing plan discusses conducting a situation analysis, market analysis, competitive analysis, and SWOT analysis to develop a strategic market plan and marketing program for launching a customization offering. The goal is to attract more customers, increase sales growth to 35% annually, and gain 0.5% additional market share within North America. Key details analyzed include Under Armour's financial performance, target markets, industry environment, and competitors. The customization platform aims to increase customer loyalty and brand awareness while helping Under Armour achieve long-term international and market leadership goals.
Assignment%20#1 under armour pest industry analysisBrian Teufel
Under Armour has used a blue ocean strategy to create the performance apparel market. It has gained a first-mover advantage and 70% of the US market share. The performance apparel industry is growing rapidly at 15% annually and is expected to reach $7.6 billion by 2014. Under Armour faces high competition from Nike and Adidas but continues to innovate and focus on enhancing performance through apparel.
Lululemon vs under armour business strategy analysisSophie Michelot
This document provides an analysis of Under Armour and lululemon athletica, two companies in the performance apparel industry. It discusses the industry information, key issues, trends, companies' goals, challenges, performance, business strategies, differences in business models, and competitive advantages. Recommendations are made for each company, including intensifying geographic expansion for lululemon and boosting sales/gaining market share through innovative products for Under Armour. Financial data and exhibits are provided in the appendices.
Under Armour is a sporting goods company founded in 1996 that sells sports apparel and equipment. Their products are worn by athletes of all levels and are sold worldwide. The company was founded by Kevin Plank and is driven by his vision to create innovative, technical fabrics and apparel. Over time, Under Armour has expanded globally and through acquisitions like MapMyFitness to strengthen their business. They differentiate themselves from competitors like Nike through their technical performance products.
This document provides an analysis of Under Armour, including:
1. A brief history of Under Armour and its founder Kevin Plank.
2. A literature review covering SWOT analysis, BCG matrix, five competitive forces, corporate strategies, and business level strategies.
3. An analysis of Under Armour's SWOT profile, BCG matrix, competitive forces, strategies, and organizational structure.
4. Recommendations regarding strengthening opportunities, addressing weaknesses, and guarding against threats through corporate level strategies, business level strategies, and organizational design changes.
How to do Under Armour's SWOT Analysis? Strengths, Weaknesses, Opportunities ...SWOT & PESTLE.com
Under Armour is an American company that manufactures athletic apparel and footwear. It was founded in 1996 and has grown significantly over the years. Some of its strengths include a broad portfolio of products across apparel, footwear, and accessories. It also has multiple distribution networks and has seen strong revenue growth. However, it also faces threats such as increasing competition and potential supply chain disruptions from events like the Covid-19 pandemic.
This project includes the business information about Under Armour, Inc. It demonstrates the mastery of analyzing the current financial position of a company and predicting the future growth.
Under Armour has an opportunity to grow through introducing a customization platform. Their marketing plan discusses conducting a situation analysis, market analysis, competitive analysis, and SWOT analysis to develop a strategic market plan and marketing program for launching a customization offering. The goal is to attract more customers, increase sales growth to 35% annually, and gain 0.5% additional market share within North America. Key details analyzed include Under Armour's financial performance, target markets, industry environment, and competitors. The customization platform aims to increase customer loyalty and brand awareness while helping Under Armour achieve long-term international and market leadership goals.
Assignment%20#1 under armour pest industry analysisBrian Teufel
Under Armour has used a blue ocean strategy to create the performance apparel market. It has gained a first-mover advantage and 70% of the US market share. The performance apparel industry is growing rapidly at 15% annually and is expected to reach $7.6 billion by 2014. Under Armour faces high competition from Nike and Adidas but continues to innovate and focus on enhancing performance through apparel.
Lululemon vs under armour business strategy analysisSophie Michelot
This document provides an analysis of Under Armour and lululemon athletica, two companies in the performance apparel industry. It discusses the industry information, key issues, trends, companies' goals, challenges, performance, business strategies, differences in business models, and competitive advantages. Recommendations are made for each company, including intensifying geographic expansion for lululemon and boosting sales/gaining market share through innovative products for Under Armour. Financial data and exhibits are provided in the appendices.
Under Armour is a sporting goods company founded in 1996 that sells sports apparel and equipment. Their products are worn by athletes of all levels and are sold worldwide. The company was founded by Kevin Plank and is driven by his vision to create innovative, technical fabrics and apparel. Over time, Under Armour has expanded globally and through acquisitions like MapMyFitness to strengthen their business. They differentiate themselves from competitors like Nike through their technical performance products.
This document provides an analysis of Under Armour, including:
1. A brief history of Under Armour and its founder Kevin Plank.
2. A literature review covering SWOT analysis, BCG matrix, five competitive forces, corporate strategies, and business level strategies.
3. An analysis of Under Armour's SWOT profile, BCG matrix, competitive forces, strategies, and organizational structure.
4. Recommendations regarding strengthening opportunities, addressing weaknesses, and guarding against threats through corporate level strategies, business level strategies, and organizational design changes.
How to do Under Armour's SWOT Analysis? Strengths, Weaknesses, Opportunities ...SWOT & PESTLE.com
Under Armour is an American company that manufactures athletic apparel and footwear. It was founded in 1996 and has grown significantly over the years. Some of its strengths include a broad portfolio of products across apparel, footwear, and accessories. It also has multiple distribution networks and has seen strong revenue growth. However, it also faces threats such as increasing competition and potential supply chain disruptions from events like the Covid-19 pandemic.
Assignment%20#3 under armour internal and swot analysisBrian Teufel
Under Armour has experienced increasing annual sales and net income since 2006, with around 80% of net income coming from performance apparel (PA). While footwear sales decreased in 2010, PA and accessories sales increased. International sales are rising but remain below 10% of total sales. Under Armour seeks to compete more broadly with Nike and Adidas beyond PA. Key strengths are innovation and brand equity.
The athletic apparel industry is worth approximately $168 billion worldwide in 2017 and is estimated to reach $231.7 billion by 2024. Major players like Nike and Adidas dominate the market but new entrants are expected to join. The industry is facing trends like activewear lines from fashion retailers only accounting for 10% of the market. The North American sports apparel market is expected to grow at a compound annual growth rate of 5.9% from 2016-2022.
The document proposes that Under Armour acquire Columbia Sportswear to quickly expand its product offerings and strategically position itself in growing international markets. It analyzes the athletic apparel industry, identifying opportunities for growth. The document concludes that acquiring Columbia would allow Under Armour to penetrate new markets, diversify its geographic footprint, and leverage Columbia's distribution channels for international expansion.
Strategic Management in a Global Context: Under ArmourRonantonnoel
Under Armour operates in the competitive performance apparel industry. It focuses on design, marketing, and product innovation while outsourcing manufacturing. Strengths include its powerful brand and superior product performance. Weaknesses include reliance on key leaders and limited protection of fabrics and designs. Continued innovation will be needed to maintain advantages. However, growth may require entering new markets like overseas and women which it currently lacks capabilities for. Acquisition may allow expanding into these markets while maintaining the brand.
Assignment%20#2 under armour competitor and market analysisBrian Teufel
This document analyzes Under Armour's competitors and the performance apparel market. It identifies Nike and Adidas as Under Armour's primary competitors. It shows the performance apparel industry has grown rapidly over the past four years at a rate of over 15% annually, and is expected to continue growing. Key trends include the positive impact of social media on sales and marketing, and growth being fueled by Asia, North America, and Europe.
Comprehensive Analysis on roadmap of strategic management
1) WHERE ARE WE NOW?
2) WHERE DO WE WANT TO GO?
3) HOW DO WE GET THERE?
4) HOW DO WE ENSURE OUR ARRIVAL?
Under Armour is proposing to establish its first retail stores and South American headquarters in Brazil to capitalize on opportunities from major sporting events. The proposal estimates costs of $25 million in 2011 growing to $88 million by 2016. Brazil's economy is growing at 5.5% annually and hosting the World Cup in 2014 and Olympics in 2016 provide marketing opportunities. Under Armour can target a niche as its products are currently priced lower than Nike and Adidas in Brazil. Political and economic stability have increased under recent administrations and currency volatility has stabilized, though fluctuations remain a risk.
Under Armour Case, Team 2 Final Presentationbcrowle2
I competed in a 2 day Deloitte Information Technology Consulting Case Competition, open to all IT students at Notre Dame. Working with a team of 3, we put together this deck of slides in less than 48 hours.
This document provides a market analysis of Under Armour, Inc. It summarizes the company's current marketing strategy, sales, and investments. The analysis finds that while revenue has increased, net income is low. Most revenue comes from North America, and high promotional investments may not be effective. The report recommends assessing investments, creating tailored international campaigns, pursuing partnerships, and using social media to boost exposure and sales growth internationally by 2025.
This document provides an analysis of the forces affecting the athletic apparel industry for Under Armour, conducting an analysis of 5 key forces: rivalry among competitors, threat of new entrants, threat of substitutes, bargaining power of buyers, and bargaining power of suppliers. Each force is examined based on 4 determinants, with the overall strength of each force rated on a 5 point scale. Additional appendices provide context on industry examples, and examine sociocultural, technological, and ecological trends in the industry through a STEEP analysis framework.
Under Armour conducts an internal analysis to identify its strengths and weaknesses. Key strengths include its focus on innovation through products like HEATGEAR and COLDGEAR, its growing connected fitness platform, and strong brand recognition from top athlete endorsements. However, weaknesses include its lack of global market penetration and lack of patents. Financially, Under Armour has experienced high revenue growth but also high debt levels, leading to a recent decline in operating margin and negative free cash flow. To further grow, Under Armour must leverage its strengths, address its weaknesses in international expansion and patents, and get its finances under control by paying down debt.
The digital strategy targets men ages 17-30 to increase awareness of Under Armour's athletic apparel and accessories. Key performance indicators include increasing sales by at least 20% through targeted social media campaigns on platforms like Twitter, Instagram, Facebook and Vine. The $2 million budget will be used for AdWords, strategy development, implementation and management. The overall goal is to establish Under Armour as the go-to brand for athletic gear in the target audience.
Nike is reorganizing its global women's fitness business to better target the $13 billion women's fitness market. The reorganization will transition decision making from a centralized to decentralized structure and establish a semi-virtual organization with regional and functional leadership teams. It will also align Nike's women's fitness brands and collections into a cohesive long-term strategy to make Nike the dominant brand for women in the fitness space.
This document contains a strategic plan for Nike created by a group of students. It includes:
1) An overview of their strategic planning process including external/internal analyses and SWOT analysis.
2) Details of their strategic thinking process with pre-session, session, and post-session brainstorming of recommendations.
3) Their strategy making including a TOWS matrix matching strategies to threats and weaknesses and strategic recommendations.
The document provides information on the strategic analyses and recommendations developed by the students for Nike to address strengths, weaknesses, opportunities, and threats.
Under Armour is an American company that manufactures sports apparel and footwear. It focuses on professional athletes and uses social media campaigns and its "I Will" tagline to target customers aged 13 to 24. The company has global headquarters in Baltimore as well as offices worldwide. Reviews of Under Armour's products and customer service were mixed, though some praised its military discount. E-commerce sales are a key driver of growth for the company.
Under armour case analysis by Njinyah CiroCiro Njinyah
This document provides an analysis of Under Armour's current situation and strategies. Some key points:
1. Under Armour has experienced strong financial growth in recent years, with revenue increasing over 25% annually on average. However, gross margins have remained around 48% due to higher input costs.
2. External factors driving growth in the industry include a rising global youth population participating in sports and growing interest in fitness. Competitive pressures come from large rivals like Nike and Adidas, as well as potential new entrants.
3. Internally, Under Armour has succeeded through innovation in performance apparel and gear, as well as marketing. Maintaining this edge in technology and brand awareness will be
Nike and Under Armour were pitted against each other in a brand comparison to determine which brand consumers prefer and why. While both are seen as expensive, popular sports brands initially, deeper analysis revealed differences. Consumers see Nike as for everyone due to its diverse, inspiring ads and association with comfortable sneakers. Under Armour is seen as for intense athletes due to its technical, performance-focused clothing. Ultimately, more consumers relate to Nike's broad appeal and see themselves wearing the brand, so it emerges as the winner though Under Armour shows potential as an athletic brand.
The document analyzes GAP Inc's strategic issues through a SWOT analysis. It identifies key strengths as franchising opportunities and global brand recognition. Main weaknesses are reliance on outside vendors and underutilized assets. Major opportunities are the women's apparel market and growing online retail. Increased competition is the primary threat. An internal and external factors analysis scores each factor. It concludes that franchising opportunities and the women's apparel market are the biggest strengths and opportunities, while reliance on vendors and competition are biggest weaknesses and threats. The TOWS matrix recommends leveraging strengths to pursue opportunities and addressing weaknesses to reduce threats.
Lululemon is valued at $75 per share based on a discounted cash flow analysis. This represents a nearly 4% premium over the current market price. Key drivers of Lululemon's value include strong growth in the athleisure market, its unique in-store experience and focus on fashion and quality, and historical financial performance. While competitors encroach on its niche, Lululemon has opportunities through expanding in Asia and growing its e-commerce segment. The valuation assumes continued revenue growth of around 10% annually through 2022.
Lululemon is a leading athletic apparel company known for its strong brand image. It has potential for expansion through new product lines like menswear and ivivva, as well as geographic growth. However, it faces key risks such as competition infringing on its strategies and instability in executive management. A discounted cash flow valuation estimates Lululemon's fair value at $66 per share, its current market price.
Assignment%20#3 under armour internal and swot analysisBrian Teufel
Under Armour has experienced increasing annual sales and net income since 2006, with around 80% of net income coming from performance apparel (PA). While footwear sales decreased in 2010, PA and accessories sales increased. International sales are rising but remain below 10% of total sales. Under Armour seeks to compete more broadly with Nike and Adidas beyond PA. Key strengths are innovation and brand equity.
The athletic apparel industry is worth approximately $168 billion worldwide in 2017 and is estimated to reach $231.7 billion by 2024. Major players like Nike and Adidas dominate the market but new entrants are expected to join. The industry is facing trends like activewear lines from fashion retailers only accounting for 10% of the market. The North American sports apparel market is expected to grow at a compound annual growth rate of 5.9% from 2016-2022.
The document proposes that Under Armour acquire Columbia Sportswear to quickly expand its product offerings and strategically position itself in growing international markets. It analyzes the athletic apparel industry, identifying opportunities for growth. The document concludes that acquiring Columbia would allow Under Armour to penetrate new markets, diversify its geographic footprint, and leverage Columbia's distribution channels for international expansion.
Strategic Management in a Global Context: Under ArmourRonantonnoel
Under Armour operates in the competitive performance apparel industry. It focuses on design, marketing, and product innovation while outsourcing manufacturing. Strengths include its powerful brand and superior product performance. Weaknesses include reliance on key leaders and limited protection of fabrics and designs. Continued innovation will be needed to maintain advantages. However, growth may require entering new markets like overseas and women which it currently lacks capabilities for. Acquisition may allow expanding into these markets while maintaining the brand.
Assignment%20#2 under armour competitor and market analysisBrian Teufel
This document analyzes Under Armour's competitors and the performance apparel market. It identifies Nike and Adidas as Under Armour's primary competitors. It shows the performance apparel industry has grown rapidly over the past four years at a rate of over 15% annually, and is expected to continue growing. Key trends include the positive impact of social media on sales and marketing, and growth being fueled by Asia, North America, and Europe.
Comprehensive Analysis on roadmap of strategic management
1) WHERE ARE WE NOW?
2) WHERE DO WE WANT TO GO?
3) HOW DO WE GET THERE?
4) HOW DO WE ENSURE OUR ARRIVAL?
Under Armour is proposing to establish its first retail stores and South American headquarters in Brazil to capitalize on opportunities from major sporting events. The proposal estimates costs of $25 million in 2011 growing to $88 million by 2016. Brazil's economy is growing at 5.5% annually and hosting the World Cup in 2014 and Olympics in 2016 provide marketing opportunities. Under Armour can target a niche as its products are currently priced lower than Nike and Adidas in Brazil. Political and economic stability have increased under recent administrations and currency volatility has stabilized, though fluctuations remain a risk.
Under Armour Case, Team 2 Final Presentationbcrowle2
I competed in a 2 day Deloitte Information Technology Consulting Case Competition, open to all IT students at Notre Dame. Working with a team of 3, we put together this deck of slides in less than 48 hours.
This document provides a market analysis of Under Armour, Inc. It summarizes the company's current marketing strategy, sales, and investments. The analysis finds that while revenue has increased, net income is low. Most revenue comes from North America, and high promotional investments may not be effective. The report recommends assessing investments, creating tailored international campaigns, pursuing partnerships, and using social media to boost exposure and sales growth internationally by 2025.
This document provides an analysis of the forces affecting the athletic apparel industry for Under Armour, conducting an analysis of 5 key forces: rivalry among competitors, threat of new entrants, threat of substitutes, bargaining power of buyers, and bargaining power of suppliers. Each force is examined based on 4 determinants, with the overall strength of each force rated on a 5 point scale. Additional appendices provide context on industry examples, and examine sociocultural, technological, and ecological trends in the industry through a STEEP analysis framework.
Under Armour conducts an internal analysis to identify its strengths and weaknesses. Key strengths include its focus on innovation through products like HEATGEAR and COLDGEAR, its growing connected fitness platform, and strong brand recognition from top athlete endorsements. However, weaknesses include its lack of global market penetration and lack of patents. Financially, Under Armour has experienced high revenue growth but also high debt levels, leading to a recent decline in operating margin and negative free cash flow. To further grow, Under Armour must leverage its strengths, address its weaknesses in international expansion and patents, and get its finances under control by paying down debt.
The digital strategy targets men ages 17-30 to increase awareness of Under Armour's athletic apparel and accessories. Key performance indicators include increasing sales by at least 20% through targeted social media campaigns on platforms like Twitter, Instagram, Facebook and Vine. The $2 million budget will be used for AdWords, strategy development, implementation and management. The overall goal is to establish Under Armour as the go-to brand for athletic gear in the target audience.
Nike is reorganizing its global women's fitness business to better target the $13 billion women's fitness market. The reorganization will transition decision making from a centralized to decentralized structure and establish a semi-virtual organization with regional and functional leadership teams. It will also align Nike's women's fitness brands and collections into a cohesive long-term strategy to make Nike the dominant brand for women in the fitness space.
This document contains a strategic plan for Nike created by a group of students. It includes:
1) An overview of their strategic planning process including external/internal analyses and SWOT analysis.
2) Details of their strategic thinking process with pre-session, session, and post-session brainstorming of recommendations.
3) Their strategy making including a TOWS matrix matching strategies to threats and weaknesses and strategic recommendations.
The document provides information on the strategic analyses and recommendations developed by the students for Nike to address strengths, weaknesses, opportunities, and threats.
Under Armour is an American company that manufactures sports apparel and footwear. It focuses on professional athletes and uses social media campaigns and its "I Will" tagline to target customers aged 13 to 24. The company has global headquarters in Baltimore as well as offices worldwide. Reviews of Under Armour's products and customer service were mixed, though some praised its military discount. E-commerce sales are a key driver of growth for the company.
Under armour case analysis by Njinyah CiroCiro Njinyah
This document provides an analysis of Under Armour's current situation and strategies. Some key points:
1. Under Armour has experienced strong financial growth in recent years, with revenue increasing over 25% annually on average. However, gross margins have remained around 48% due to higher input costs.
2. External factors driving growth in the industry include a rising global youth population participating in sports and growing interest in fitness. Competitive pressures come from large rivals like Nike and Adidas, as well as potential new entrants.
3. Internally, Under Armour has succeeded through innovation in performance apparel and gear, as well as marketing. Maintaining this edge in technology and brand awareness will be
Nike and Under Armour were pitted against each other in a brand comparison to determine which brand consumers prefer and why. While both are seen as expensive, popular sports brands initially, deeper analysis revealed differences. Consumers see Nike as for everyone due to its diverse, inspiring ads and association with comfortable sneakers. Under Armour is seen as for intense athletes due to its technical, performance-focused clothing. Ultimately, more consumers relate to Nike's broad appeal and see themselves wearing the brand, so it emerges as the winner though Under Armour shows potential as an athletic brand.
The document analyzes GAP Inc's strategic issues through a SWOT analysis. It identifies key strengths as franchising opportunities and global brand recognition. Main weaknesses are reliance on outside vendors and underutilized assets. Major opportunities are the women's apparel market and growing online retail. Increased competition is the primary threat. An internal and external factors analysis scores each factor. It concludes that franchising opportunities and the women's apparel market are the biggest strengths and opportunities, while reliance on vendors and competition are biggest weaknesses and threats. The TOWS matrix recommends leveraging strengths to pursue opportunities and addressing weaknesses to reduce threats.
Lululemon is valued at $75 per share based on a discounted cash flow analysis. This represents a nearly 4% premium over the current market price. Key drivers of Lululemon's value include strong growth in the athleisure market, its unique in-store experience and focus on fashion and quality, and historical financial performance. While competitors encroach on its niche, Lululemon has opportunities through expanding in Asia and growing its e-commerce segment. The valuation assumes continued revenue growth of around 10% annually through 2022.
Lululemon is a leading athletic apparel company known for its strong brand image. It has potential for expansion through new product lines like menswear and ivivva, as well as geographic growth. However, it faces key risks such as competition infringing on its strategies and instability in executive management. A discounted cash flow valuation estimates Lululemon's fair value at $66 per share, its current market price.
Assignment%20#3 under armour internal and swot analysisBrian Teufel
Under Armour has experienced increasing annual sales and net income since 2006, with around 80% of net income coming from performance apparel (PA). While footwear sales decreased in 2010, PA and accessories sales increased. International sales are rising but remain below 10% of total sales. Under Armour aims to compete more broadly with Nike and Adidas beyond PA. Key strengths are innovation and brand equity.
Under Armour uses ineffective CSR initiatives and non-market strategies that contribute to its underperformance compared to industry rivals. While the sports apparel industry is generally profitable, Under Armour has higher costs and lower prices than competitors like Nike. Under Armour has made mistakes with vertical expansion in the past but has effectively used horizontal expansion through partnerships and sponsorships.
Strategic Analysis of Nike, Under Armour & IMGTiantong Liu
Strategic Analysis of Nike, Under Armour & IMG
Content include:
Mission & Vision of each organization
PESTEL Analysis
Five Forces Model Analysis
Suggestions
Strength & Weakness
Strategic Implementation
My group created an Integrated marketing strategy plan for Nike athletic shoes, based on the data collected from Nike 10K report, Statista, IBISWorld, and etc. in 2018. This slides include but not limited to industry analysis, market analysis, competition analysis, business analysis, recommendations for 2019.
Under Armour has experienced steady growth due to a focus on sports apparel innovation, strong company culture, and streamlined leadership. The report recommends strategies for Under Armour to continue expanding globally while maintaining their innovative culture, focus on research and development, and expand into footwear and youth markets. A SWOT analysis found strengths in brand loyalty and quality products, and opportunities in women's/youth apparel and footwear. International expansion and technology were also identified as opportunities.
Children’s Wear Market PPT 2023: Size, Growth, Demand and Forecast till 2028IMARC Group
The global children’s wear market size reached US$ 275.7 Billion in 2022. Looking forward, IMARC Group expects the market to reach US$ 369.5 Billion by 2028, exhibiting a growth rate (CAGR) of 4.9% during 2023-2028.
More Info:- https://www.imarcgroup.com/children-wear-market
UA Equity Valuation Examination (Sample Project)Raphael Denize
This document analyzes Under Armour and the sporting goods industry. It provides a SWOT analysis of Under Armour, noting strengths like their brand recognition but also weaknesses such as high production costs. The industry analysis shows the apparel, footwear, and sportswear segments are in decline. For Under Armour to sustain growth, they will need to invest heavily in R&D, penetrate European and Asian markets, and differentiate their footwear to compete against larger rivals in this mature industry.
Under Armour is reviewing for a new media agency, according to people with knowledge of the matter.
Omnicom Media Group's Optimum Sports has been working on the business since 2011. Representatives from Optimum Sports and Under Armour were not immediately available for comment. Droga5 continues to serve as the brand's creative agency partner.
Last year, the agency captured the intense, rigorous and solitary training rituals of Olympic gold-medalist swimmer Michael Phelps in an Under Armour spot that took home the Grand Prix in the Film Craft Category at the 2016 Cannes Lions International Festival of Creativity.
Under Armour spent $20.6 million on measured media in the U.S. in 2015, according to Ad Age's Datacenter, and about $10.1 million on measured media in the U.S. from January to November of last year.
Under Armour faces low barriers to entry into the sports apparel industry due to high capital requirements, product differentiation by major competitors like Nike and Adidas, and difficulty obtaining effective distribution channels. The bargaining power of Under Armour's suppliers is high because they rely heavily on a small number of suppliers and many intellectual property rights are owned by suppliers. The bargaining power of buyers is also high since customers purchase a large portion of industry output and can easily switch between brands. Rivalry among competitors in the industry is intense due to equally balanced major competitors and high fixed costs. Under Armour differentiates itself through a focus on performance and authenticity.
Retail Environment: US Retail Revolution
1. Retail Revolution Is Happening: Store Openings and Closures
2. All-Channel Universe Will Require Adaptation
Top 8 Global Retail Trends
1. Corporate Innovation Is the New R&D
2. Store as a Platform
3. Wellness as the New Luxury
4. Consumers Want to Be Part of a Community
5. Personalization and Customization
6. Resale Is Thriving While Retail Is Struggling
7. Demographics Suggest Opportunity in Plus-Size Apparel
8. Silver Economy: Aging Population Will Impact Retail
Product life cycle (PLC) & Boston Consultancy Group (BCG) MBA pptPratik Thakkar
The ppt gives details info about BCG Matrix as well as Product Life Cycle.
The ppt project is on study of Automobile industry, done during my MBA (M.U).
This document provides information about the luxury fashion brand Giorgio Armani. It discusses Armani's position as a leading fashion house in Europe, its brand extension model, competitors like Yves Saint Laurent and Gucci, and the tendency of market growth in the luxury fashion sector. The document also summarizes Armani's market share, revenues over time which have increased from $209 million in 1985 to $1.6 billion in 2005, and its diverse product portfolio. Additionally, it performs a SWOT analysis of Armani and discusses its target demographics including business class, higher income groups, and celebrities. The one-year marketing campaign focuses on new segments, distinctive products, emerging Asian markets, and
GIC x Nanyang Capital Stock Pitch Challenge 2018 - Alpha CapitalAndy Chang
Under Armour has struggled with ineffective inventory management, which has weighed down gross margins as the company has had to sell inventory at a discount. The company has also been unable to capitalize on the fast-growing athleisure market due to its late entry and weak marketing strategies that are not targeted towards the athleisure consumer. Additionally, the company's restructuring plans are viewed as unlikely to generate sufficient savings, and its bullish Asia-Pacific growth projections are not expected to materialize in the short to medium term.
Lululemon is a leading retailer of athletic apparel that has experienced sustained success through international expansion, growth of e-commerce sales, and plans to enter new markets like men's and teen apparel. The company is currently valued at $64.50 per share but is undervalued according to the analyst's valuation of $68.80 based on growth opportunities in store locations, online sales, and new product categories that could yield an 11.4% annual revenue CAGR through 2019.
This document outlines questions to consider when conducting an industry and competitive analysis. It discusses assessing the dominant economic features of an industry, including market size, growth, and profitability. It also addresses the competitive forces within an industry using Porter's five forces model. Additional questions focus on identifying the strongest and weakest companies, anticipating rivals' strategies, determining factors for success, and evaluating a company's attractiveness and profitability prospects within its industry.
1. Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
Under Armour Valuation Project
Mia Seder, Julia Blanco, Ted Nehrbas, Claudia Esteva, Ryan Buzzell & Bobby Weaver
July 10, 2015
Tuck Bridge Summer Program 2015
2. Under Armour is overvaluedby the market at
$84 per share; wevalue UA at $68 pershare
•UA’s revenue rates are expected to exceed the average
market revenue growth rates in the short-term
•UA is a strong competitor, but lacks consumer ratings
Under Armour’s
Growth Bubble
•UA’s brand continues to develop through originality,
athletic performance and innovative enhancements
•UA has created a revolutionary fitness community to
gain a competitive edge
Highly Competitive
Market
•UA’s growth is currently driven by its women’s
apparel, footwear, and international development
•UA faces associated risks from these opportunities
Overestimated
Expansion Potential
•UA is overvalued
•Increasing revenue growth rates is unsustainable in
their competitive market
Valuation
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation2
3. Under Armour is overvaluedby the market at
$84 per share; wevalue UA at $68 pershare
•UA’s revenue rates are expected to exceed the average
market revenue growth rates in the short-term
•UA is a strong competitor, but lacks consumer ratings
Under Armour’s
Growth Bubble
•UA’s brand continues to develop through originality,
athletic performance and innovative enhancements
•UA has created a revolutionary fitness community to
gain a competitive edge
Highly Competitive
Market
•UA’s growth is currently driven by its women’s
apparel, footwear, and international development
•UA faces associated risks from these opportunities
Overestimated
Expansion Potential
•UA is overvalued
•Increasing revenue growth rates is unsustainable in
their competitive market
Valuation
3 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
4. The global sportsapparelmarket is expectedto
increasefrom 3.4% to 4.0% starting 2015
0
20
40
60
80
100
120
140
160
180
2011 2012 2013 2014 2015E 2016E 2017E 2018E
$ Billion
4.0% CAGR
3.4% CAGR
Total Global Sport Apparel Market Sales and Projections
Source: Statista
132
B
135
B
141
B
146
B
152
B
158
B
165
B
171
B
4 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
5. Under Armour 28.0%
UA constitutesa fraction of total market revenue
but maintains the highest growthrate at 28%
Source: Market Realist
0%
20%
40%
60%
80%
100%
Total revenue breakdown
CAGR (2010-2014)
Lululemon 26.0%
Adidas 4.9%
Nike 10.0%
Other
Market%
Global Sports Apparel Market
5
3.4%
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
6. Consumerperspectiveson athletic apparel
brands’ strengths and weaknesses
Under Armour Nike Adidas Lululemon
Price
Technology
Development
Consumer
Preference
Quality
Total 63/100 75/100 50/100 31/100
6
Least appealing to
consumer
Most appealing to
consumer
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
7. Under Armour is overvaluedby the market at
$84 per share; wevalue UA at $68 pershare
•UA’s revenue rates are expected to exceed the average
market revenue growth rates in the short-term
•UA is a strong competitor, but lacks consumer ratings
Under Armour’s
Growth Bubble
•UA’s brand continues to develop through originality,
athletic performance and innovative enhancements
•UA has created a revolutionary fitness community to
gain a competitive edge
Highly Competitive
Market
•UA’s growth is currently driven by its women’s
apparel, footwear, and international development
•UA faces associated risks from these opportunities
Overestimated
Expansion Potential
•UA is overvalued
•Increasing revenue growth rates is unsustainable in
their competitive market
Valuation
7 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
8. UA’s original apparel innovation has provided the
foundation for 20 years of high performance
products
1996
Compression
T-shirt
1998
ColdGear
Mock
2006
Click-Clack
2011
Charged
Cotton
2012
Armour Bra
2015
UA Record
8
Adidas Clima-chill Nike Cold Tech. Fitbit Fitness Band
Product Equivalents
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
9. Strategic sponsorshipshelp pushUnderArmour’s
brand forward, but market remains competitive
9
41% increase
in footwear
sales
Increased fan
base
Women’s
apparel
reaches 30%
Source: Nasdaq, USAToday
2x
sponsorships
6/10 top
endorsements
in 2014
Dominant
sponsor in all
5 big sports
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
10. UA creates the Recordappto reach new
customers
Synthesized fitness
platform
Connected fitness
community
120 million users
Mapmyfitness
20 million users
Diverse suite of programs
under it’s brand
MyFitnessPal
80 million users
Leading fitness tracking
application
Endomondo
20 million users
80% of users outside U.S.
HTC Grip
Wearable device
10
}
$571 M
acquisition fee
Generates $8.4
M in tangible
Potential
valuation of
$5-10B
Garmin
application
VS.
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
11. Under Armour is overvaluedby the market at
$84 per share; wevalue UA at $68 pershare
•UA’s revenue rates are expected to exceed the average
market revenue growth rates in the short-term
•UA is a strong competitor, but lacks consumer ratings
Under Armour’s
Growth Bubble
•UA’s brand continues to develop through originality,
athletic performance and innovative enhancements
•UA has created a revolutionary fitness community to
gain a competitive edge
Highly Competitive
Market
•UA’s growth is currently driven by its women’s
apparel, footwear, and international development
•UA faces associated risks from these opportunities
Overestimated
Expansion Potential
•UA is overvalued
•Increasing revenue growth rates is unsustainable in
their competitive market
Valuation
11 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
13. Women’s apparelis UA’s fastest growing
segment, outcompetingthe market nine times
32
33
34
35
36
37
2013 2014 2015E
Athleisure Market
13
8% CAGR
4.1% CAGR
0
500
1000
1500
2013 2014 2015E 2016E
UA’s Female Market
Revenue
650 M
1 B
$ Billions
$ Millions
35.7% CAGR
400 M
500 M
33.7 B
35.1 B
36.5 B
Source: Company Reports, Analyst Projections, NPD Reports
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
14. 44.2% increasein UA footwearrevenues from
2013to 2014withnew footwear
0
200
400
600
800
2011 2012 2013 2014 2015E 2016E
Footwear revenues$ millions
14
Source: Forbes, UA
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
15. Between 2016 and 2020, international
revenuesprojectedto grow from 12% to 30%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
2010 2012 2014 2016E 2018E 2020E
International Revenue as a Percentage of Total
Revenue
$655 Million
$4 Billion
Source: Company Reports
15 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
16. ExistingUA storelocations worldwideas of 2015
Market Position - Highly Competitive Market - Growth Opportunities/ Associated Risks - Valuation16
Source: Company Reports
18. Under Armour faces fourmajor limitationsto
future revenue growth
Limitations
Competitors
Limited
international
brand recognition
Acquisition of
fitness community
Third-party
manufacturers
and suppliers
Middle
East
15%
CaSA
14% Asia
66%
18 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
19. Under Armour is overvaluedby the market at
$84 per share; wevalue UA at $68 pershare
•UA’s revenue rates are expected to exceed the average
market revenue growth rates in the short-term
•UA is a strong competitor, but lacks consumer ratings
Under Armour’s
Growth Bubble
•UA’s brand continues to develop through originality,
athletic performance and innovative enhancements
•UA has created a revolutionary fitness community to
gain a competitive edge
Highly Competitive
Market
•UA’s growth is currently driven by its women’s
apparel, footwear, and international development
•UA faces associated risks from these opportunities
Overestimated
Expansion Potential
•UA is overvalued
•Increasing revenue growth rates is unsustainable in
their competitive market
Valuation
19 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
20. Under Armour is overvaluedby the market at
$84 per share; wevalue UA at $68 pershare
20
Beta:
.739
WACC:
6.4%
Terminal Growth
Rate: 3.0%
Current Share
Price:
$85
Estimated Share
Value: $68
Year 2015E 2016E 2017E 2018E 2019E Terminal
($ in thousands)
Total Revenue 4,102,212 5,455,942 7,256,403 9,651,016 12,835,851 13,220,927
Operating Cost 3,729,131 4,959,745 6,596,460 8,773,292 11,668,479 12,018,533
EBIT 373,081 496,197 659,943 877,724 1,167,373 1,202,394
After-tax Income 226,833 301,688 401,245 533,656 709,763 731,055
(+) Depreciation 95,582 127,123 169,074 224,869 299,075 308,048
(-) Change in NWC 66,124 83,580 89,782 93,967 94,645 97,484
(-) CAPX 610,000 158,904 211,343 281,086 373,844 308,048
Free Cash Flow (353,709) 186,327 269,195 383,472 540,349 633,571
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
21. Assumptionsare conservativebasedon
historicalaverages
21
2012 25%
2013 27%
2014 32%
2015E – 2019E 33%
Terminal Growth
Rate
3.0%
COGS 51% of revenue
SG&A 37% of revenue
Depreciation 2.3% of revenue
Tax Rate 39.2%
Working Capital See appendix
CapEx See appendix
Revenue Growth Other Rates
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
22. UA priceper share is most dependenton its COGS
and SG&A expenses
22
Price Per Share ($)
COGS
SG&A
Revenue Growth
Terminal Growth
2012 2013 2014 Average
COGS 52.1% 51.3% 51.0% 51.4%
SG&A 36.5% 37.4% 37.6% 37.2%
20 30 40 50 60 70 80 90 100 110
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
23. Pessimistic,base, and optimisticrevenue
growthrate outlooks
Most
Pessimistic
Somewhat
Pessimistic
Base Case
Somewhat
Optimistic
Most
Optimistic
Revenue
Growth
Rate
27% 30% 33% 36% 39%
COGS
(% of rev)
51% 51% 51% 51% 51%
SG&A
(% of rev)
37% 37% 37% 37% 37%
Terminal
Growth
Rate
3.0% 3.0% 3.0% 3.0% 3.0%
Stock Price $46 $56 $68 $80 $94
23 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
24. Under Armour is overvaluedby the market at
$84 per share; wevalue UA at $68 pershare
•UA’s revenue rates are expected to exceed the average
market revenue growth rates in the short-term
•UA is a strong competitor, but lacks consumer ratings
Under Armour’s
Growth Bubble
•UA’s brand continues to develop through originality,
athletic performance and innovative enhancements
•UA has created a revolutionary fitness community to
gain a competitive edge
Highly Competitive
Market
•UA’s growth is currently driven by its women’s
apparel, footwear, and international development
•UA faces associated risks from these opportunities
Overestimated
Expansion Potential
•UA is overvalued
•Increasing revenue growth rates is unsustainable in
their competitive market
Valuation
24 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
25. Appendix
1. Intro Slide
2. Executive Summary
3. Market position exec summary
4. Global sports apparel market growth
5. Market revenue breakdown and competitor
growth rates
6. Consumer perspectives
7. Highly competitive market exec summary
8. Apparel innovation timeline
9. Strategic Sponsorships
10. Record application
11. Expansion Opportunities / Associated Risks exec
summary
12. Key growth drivers
13. Women’s apparel
14. Footwear revenue increase
15. International revenue growth
16. UA map
17. Nike map
18. Risks
19. Valuation exec summary
20. Revenue breakdown/ Free cashflows
21. Revenue growth forecasts
22. Sensitivity analysis
23. Bear, base, bull cases
24. Final exec summary
25. Appendix
26. UA sales growth
27. Stock prices
28. Total revenue breakdown by product
29. Huge growth opportunities in the consumer
health industry
30. If UA can monetize Record, potential value
creation
31. Growth of the consumer health market creates a
shift in health consumer needs
32. International revenue growth comparison to Nike
33. Perceptual map
34. Athletic clothing preferences
35. What is athleisure wear?
36. Number of mobile devices with health apps
37. Increase in UA owned stores
38. What is Under Armour?
39. Coldgear/ Hotgear tech slide
40. UA Map
41. WACC Calculation
42. Equity Value per Share Calculation
25 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
26. UA’s sales havegrownat a rate of 28% and are
projectedto grow at 33% in the future
0
2
4
6
8
10
12
14
2011 2012 2013 2014 2015E 2016E 2017E 2018E 2019E
$ Billions
Total Under Armour Sales and Projections
28.0% CAGR
33.0% CAGR
Source: Analyst Projections
1.47 B
1.83 B
2.33 B
3.08 B
7.26 B
9.65 B
12.84 B
4.10 B
5.45 B
26 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
28. With three differentlines of performanceand
climate specificgear, apparelconstitutes75%
of total revenue
Under Armour Revenue Breakdown
2014
0%
20%
40%
60%
80%
100%
13% Footwear
9% Accessories
75%
Apparel
3% Licensing
28 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
29. UA recognizesthe huge growthopportunities
in the consumerhealth industry
0
5,000
10,000
15,000
20,000
25,000
30,000
2013 2014 2015E 2016E 2017E
Global mHealth app market
revenue
Global Sahipments of wearble
fitness devices
Projections for wearable fitness device
sales of 1.8B by end of 2015
(USD $ millions)
Year
Revenues for global mHealth
app’s projected $26.6 B in 2017
29 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
30. If UA can monetize Record, potential value
creation is $5-10B
Ticker “Year
1”Sales
(#M)
“Year 5”
Sales (M$)
4-yr sales
CAGR
Year 5 EOY
market cap
($M)
Price-to-
Sales Ratio
FB 272 5089 108% $63,142 12x
LNKD 79 972 87% $12,593 13x
TWTR 28 1403 165% $22,760 16x
YELP 48 378 68% $3,969 11x
GRPN 31 2574 203% $7,860 3x
ZNGA 19 1281 185% $1,839 1x
Average 79 1949 123% $18,694 10x
UA bull case 55 750 92% $7,192 10x
Bull Case for UA
Source: Bloomberg: Analyst Report
30 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
31. Projected~50%growthofthe$502Bconsumerhealth
marketby2017createsashiftinhealthconsumerneeds
$502B
$737 B
Health Consciousness
In-home Diagnostics
Mobile Health Apps
Mobile health
apps help
consumers
achieve these
preventative
actions.
In home
diagnostic testing
market is $15
billion, growing at
~5% per year.
-Increased awareness of consumers regarding
preventative methods of health care
- New “health-oriented” consumer
increasingly pursues preventative measures
that allow them to take control to improve
their health outcomes.
Projected
Consumer Health
Market
31 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
33. How does UA appeal to customers
Enhances athletic
performance
Aesthetically sharp
and distinctive
Affordable/practical
Appeals to
conservative tastes
Highest quality/price
Comfortable for
everyday wear
33 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
34. Under Armour evolves to satisfy
changing consumer preferences
Comfort
Fit
Moisture Wicking
Flexibility
Breathability
0% 10% 20% 30% 40% 50%
Athletic Clothing Preferences
34 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
37. Increase in UA owned stores from
134 in 2014 to 153 in 2015
0
20
40
60
80
100
120
140
160
2014 2015
Factory House Stores
Brand House Stores
NumberofUAstores
37 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
38. Foundedby a former football player,UA caters
to the specializedneeds of athletes
38
• Started 1996
• Founder: Kevin Plank
• Specialized
performance apparel
• Sports footwear and
accessories
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
39. Keepingwiththeir mission,UA strivesto provide
the consumerwith high quality, innovativegear
39
"To make all athletes better through passion, science, and the relentless pursuit of
innovation"
Revolutionary Moisture
Transport System
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
40. Openingof UA new internationalbrand house
stores and officesduring 2015
Sao Paolo, Brazil
Abu Dhabi, UAE
China
Germany
40
Source: Company Reports
Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
41. WACC calculation
Risk-free rate 2.40%
Beta 7.39
Expected Return 7.94%
Market risk premium 5.54%
Cost of equity 6.49%
Average cost of debt 3.10%
Debt/Total Value 1.53%
Equity/Total Value 98.47%
WACC 6.42%
41 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
42. Equity value per share calculation
Estimated Long-term revenue growth rate 3.00%
Terminal Value 18,506,288
Enterprise Value 14,306,209
Cash & Cash Equivalents 593,175
Debt 284,201
Equity Value 14,615,182.92
Shares outstanding 215,537
Equity Value per Share 67.81
42 Under Armour’s Growth Bubble - Highly Competitive Market – Overestimated Expansion Potential - Valuation
Editor's Notes
----- Meeting Notes (7/6/15 21:52) -----
Put date, group # Fancify
----- Meeting Notes (7/8/15 11:51) -----
Make UA more pronounced
After completing our research, we concluded that Under armour is overvalued by the market at 68$ per share for four central reasons.
-The first driver of our valuation regards Under Armours position within the sportswear apparal market, how does Under Armour differentiate itself from their competitors and gain market share within the sports apparel and equipment industry?
-The second driver of our valuation growth examines how Under armour leads innovation in their industry.
-The third driver assesses opportunities of growth for Under Armour as they expand abroad, enter new markets, and the potential risks associated with these strategies. their creation of new products, strategies for expanding internationally, and the efforts to capture the growing market of athletic leisure apparal for women.
For these three reasons, we recognize that Under Armour would need to sustain, what we believe is an unsustainable long term growth rate, thus making their stock currently over valued.
Next, Julia will expand on Under Armours role within their market.
After completing our research, we concluded that Under armour is overvalued by the market at 68$ per share for four central reasons.
-The first driver of our valuation regards Under Armours position within the sportswear apparal market, how does Under Armour differentiate itself from their competitors and gain market share within the sports apparel and equipment industry?
-The second driver of our valuation growth examines how Under armour leads innovation in their industry.
-The third driver assesses opportunities of growth for Under Armour as they expand abroad, enter new markets, and the potential risks associated with these strategies. their creation of new products, strategies for expanding internationally, and the efforts to capture the growing market of athletic leisure apparal for women.
For these three reasons, we recognize that Under Armour would need to sustain, what we believe is an unsustainable long term growth rate, thus making their stock currently over valued.
Next, Julia will expand on Under Armours role within their market.
----- Meeting Notes (7/7/15 21:17) -----
Source on the left
Make a bottom bar: where are we?
----- Meeting Notes (7/7/15 23:20) -----
Showing that the market is strong and is expected to grow in the future at an even higher rate
----- Meeting Notes (7/8/15 11:51) -----
has been growing at 3.42 and is expected to continue growing to 4.0%
fix tracker
----- Meeting Notes (7/8/15 15:42) -----
In the last four years***
Has grown at*
bold tracker
UA’s growth record since its inception in 1996 has been exemplary. Revenue has grown to $3.1 billion in 2014. The company has been able to grow revenue at 20%+ growth rates for 19 consecutive quarters.
In contrast, peers Nike, Lululemon Athletica (LULU), and Adidas (ADDYY) have exhibited more modest growth. NKE, LULU, and ADDYY grew sales at a CAGR of 10%, 26%, and 4.9%, respectively, over their respective five-year fiscal periods.
----- Meeting Notes (7/6/15 21:52) -----
Separate CAGR from name (leave name on right)
First slide should be sports apparel
----- Meeting Notes (7/7/15 21:17) -----
Move Lululemon to the right, show growth of sports apparel market in its spot, and find CAGR projection
Numbers in the title
----- Meeting Notes (7/8/15 11:51) -----
Include global sports apparel market CAGR
----- Meeting Notes (7/7/15 23:20) -----
Add another row of information
Make it clearer what we mean by reputation
Quality
----- Meeting Notes (7/8/15 11:51) -----
Define the perspective as consumer's
Add one more thing like comfort
Reformat consumer preference
----- Meeting Notes (7/8/15 15:42) -----
What the harvey balls mean
After completing our research, we concluded that Under armour is overvalued by the market at 68$ per share for four central reasons.
-The first driver of our valuation regards Under Armours position within the sportswear apparal market, how does Under Armour differentiate itself from their competitors and gain market share within the sports apparel and equipment industry?
-The second driver of our valuation growth examines how Under armour leads innovation in their industry.
-The third driver assesses opportunities of growth for Under Armour as they expand abroad, enter new markets, and the potential risks associated with these strategies. their creation of new products, strategies for expanding internationally, and the efforts to capture the growing market of athletic leisure apparal for women.
For these three reasons, we recognize that Under Armour would need to sustain, what we believe is an unsustainable long term growth rate, thus making their stock currently over valued.
Next, Julia will expand on Under Armours role within their market.
http://investor.underarmour.com/income.cfm
http://www.uabiz.com/company/history.cfm
Kevin plank talks about UA genuine products-
http://www.inc.com/magazine/201407/tom-foster/kevin-planks-formula-for-under-armours-innovative-design.html
New image links:
https://a248.e.akamai.net/f/248/9086/10h/origin-d4.scene7.com/is/image/Underarmour/V5-1257468-600_HTF?scl=1&fmt=jpg&qlt=70&wid=1064&hei=1240&size=2266,2641&extend=0,792,0,0&cache=on,off&bgc=efefef&resMode=sharp2
-Strategic sponsorships help Under Armour increase brand recognition, reach new consumers, and help them compete against highly competitive companies like Nike and Adidas.
-Just last year, Under Armour signed Misty Copeland, the first female African-American dancer to be the principal dancer in the 75 year history of the American Ballet.
-In 2013, Under Armour scored two huge deals with the signing of Jordan Speith, the winner of this years Masters and US Open Golf tournaments, in addition to Steph Curry, the leading point guard for the Golden State warries, this years NBA’s MVP leading his team to an NBA Championship over Lebron James and the Cavaliers last month.
-Under Armour has always had a strong connection to football as the CEO Kevin Plank played for the Maryland Terps in his college days. Under Armour is the offical sponsor for the Terps, as well as Notre Dame, one of the top ten best college teams in the country. Under Armour’s presence expands beyond collegiate sports, in 2010, they signed star quarterback Tom Brady, 4 time super bowl champ, 3 time super bowl mvp, and 2 time NFL mvp.
-These sponsorships enable Under Armour to grow, the Steph Curry basketball shoe produced last year contributed to the 41% increase in footwear sales in 2014, as well as Misty Copeland’s ad campaign illustrating Under Armour’s efforts to reach female consumers as women’s apparal has become a crucial revenue driver, reaching over 30% of Under Armours total revenue.
Scoring the top athletes is not the only way Under Armour tries to edge itself out amongst it’s competitors, in the next slide we will look at their entry into the health and fitness app market as they continue to try and become a leader within the sports apparal industry.
Over the past two years, Under armour has acquired three fitness and health applications, Mapmyfitness, Myfitnesspal, and Endomondo.
mapmyfitness is a comprehensive health and fitness app that includes the sub categories of mapmyrun and mapmyride. This app enables users to map their exercise with over 70 million different routes to choose from, track their acitvity and share with friends. Mapmyfitness reaches over 20 million users.
-myfitnesspal is the most popular traking application for food intake and calories, used widely by personal trainers.
-myfitnesspal was such an attractive acquisition for Under Armour because the app is built into most other health fitness apps which use myfitnesspal as a direct connection to funnel their data through.
-they currently boast 45 million active users
-endomondo is a similar health and fitness tracking app with it’s headquaters in Copenhagen. Of their 20 million subscribers, 80% live outside the U.S.
Under Armour invested heavily, $571 million over the past two years, to acquire these three apps and combine their capabilities into one all inclusive platform known as Under Armour Record, a synthesized fitness and health app that creates the largest connected fitness community in the world where users can track personal health data with fitness activity, participate in community challenges, and easily share content to keep you synced with your fitness goals. In creating the Record app, Under Armours hopes to connect to new consumers and increase brand awareness amongst app users for their existing products. By creating a digital service that helps athletes and fitness minded people train and preform optimally, this will ultimately bring more customers into their stores. Record is also Under Armours way of competing against Nike +’s fitness app, vying to gain the first mover advantage in building the connected fitness application network.
The difficulty in quantifying the success of the Record app lies in the fact that the revenue derived from Record is intangible. Under Armour must find a way to monetize this fitness network. One way under armour is trying to do this is through their recent partnership with HTC, who manufacters the Grip, a wearable activity tracking device that exclusively uses the Under Armour Record platform software. HTC provides the hardware and Under Armour supplies the software.
Currently, CEO Kevin Plank has measured the success of Record by the number of new consumers reached, in quarter 1 of 2014, on average 130,000 people per day download the app. Yet, the Connected Fitness revenue as represented in the balance sheet is only $8.4 million. If Under Armour can successfully create this global fitness community that mirrors the global social community created by facebook, analyst reports value the Record between 5-10 billion of dollars, but that remains to be unseen. In the next slide, Claudia will explain opportunities for growth and the strategies Under Armour is employing capture these new opportunities.
After completing our research, we concluded that Under armour is overvalued by the market at 68$ per share for four central reasons.
-The first driver of our valuation regards Under Armours position within the sportswear apparal market, how does Under Armour differentiate itself from their competitors and gain market share within the sports apparel and equipment industry?
-The second driver of our valuation growth examines how Under armour leads innovation in their industry.
-The third driver assesses opportunities of growth for Under Armour as they expand abroad, enter new markets, and the potential risks associated with these strategies. their creation of new products, strategies for expanding internationally, and the efforts to capture the growing market of athletic leisure apparal for women.
For these three reasons, we recognize that Under Armour would need to sustain, what we believe is an unsustainable long term growth rate, thus making their stock currently over valued.
Next, Julia will expand on Under Armours role within their market.
Include CAGR
According to NPD, sales of activewear reached $35.1bn through October, representing 17% of the total apparel market, keeping the category on an upward trajectory for the past few years. NPD also noted that activewear sales have increased 8% for the 12 months ended in October while denim is down 8%. http://blogs.barrons.com/stockstowatchtoday/2015/02/13/nike-under-armour-lululemon-how-millennials-will-drive-demand-for-athletic-wear/
Drivers of athletic leisure apparal mrket
-increased heatlh consciousness amongst consumers
-growing popularity of sports leisure apparel amongst women partiucarly, comfortable atheltic apparel has become part of everyday wardrobe
-rising demand for sprots apparl abroad in emmerging markets and incresased disposable income of consumers in these same markets
All thise combine to contribute to an 8% increase in sales since 2013. add cagr rate after 2014 (and we believe under armour is well positioned for the reasons in the next slide)
11.) rely on high quality products to sustain success in growing athleisure market(high quality leggings. Use lululemon case w see through leggings)
The global sports apparel market was worth $135 billion in 2012, according to our estimates. We expect the market to grow at a CAGR of 4% during 2012-2019 to reach $178 billion.
Various factors are expected to drive market growth such as growing fitness consciousness, rising income levels in developing countries, the growing popularity of sports apparel for women as well as the trend towards stylish and comfortable sportswear.
Rising demand from Asia Pacific and Latin America due to growing economic prosperity in these regions coupled with a trend towards leading a healthy lifestyle will be the key catalysts for market growth.
(trefis)
----- Meeting Notes (7/8/15 15:42) -----
What is the CAGR for UA women (around 50%)
somehow show that it is higher than the market
----- Meeting Notes (7/8/15 19:44) -----
Add CAGR, ADD source, #s within the bar
Expect to have 35-38 branches in southeast asia by 2018.
International expansion has reversed from previous challenges and appears to be accelerating, still representing a large opportunity, as less than 10% of revenue is from outside North America.
30% of total by 2020, there is a potential for growth in the market.
At some point, Plank projects that more than half of the company’s sales will be outside the United States
----- Meeting Notes (7/6/15 21:52) -----
Use Bar graph
----- Meeting Notes (7/7/15 23:20) -----
Make the title claro
Or maybe include jst
----- Meeting Notes (7/8/15 11:51) -----
Make a slide for number of stores only
Fix source
----- Meeting Notes (7/8/15 15:42) -----
CAGR
Increase in UA owned stores from 134 in 2014 to 153 in 2015
----- Meeting Notes (7/8/15 19:44) -----
add in CAGR!!!
Notes for claudia
Under armour (this past year) opened new offices in Germany, a new store in Sao Paolo Brazil and Abu Dhabi, UAE
http://globalbb.onesource.com/Web/Reports/ReportMain.aspx?KeyID=51347623&Process=CP&CIK=1336917&Report=STRENGTHWEAKNESS
10K--Many of the specialty fabrics used in our products are technically advanced textile products developed by third parties and may be available, in the short-term, from a very limited number of sources. Substantially all of our products are manufactured by unaffiliated manufacturers, and, in 2014, 10 manufacturers produced approximately 52% of our products. We have no long term contracts with our suppliers or manufacturing sources, and we compete with other companies for fabrics, raw materials, production and import quota capacity.
Pictures: http://www.eventostoppanama.com/wp-content/uploads/2010/10/under-armour-panama.jpg
----- Meeting Notes (7/7/15 21:17) -----
Limitted brand recognition *abroad*
After completing our research, we concluded that Under armour is overvalued by the market at 68$ per share for four central reasons.
-The first driver of our valuation regards Under Armours position within the sportswear apparal market, how does Under Armour differentiate itself from their competitors and gain market share within the sports apparel and equipment industry?
-The second driver of our valuation growth examines how Under armour leads innovation in their industry.
-The third driver assesses opportunities of growth for Under Armour as they expand abroad, enter new markets, and the potential risks associated with these strategies. their creation of new products, strategies for expanding internationally, and the efforts to capture the growing market of athletic leisure apparal for women.
For these three reasons, we recognize that Under Armour would need to sustain, what we believe is an unsustainable long term growth rate, thus making their stock currently over valued.
Next, Julia will expand on Under Armours role within their market.
After completing our research, we concluded that Under armour is overvalued by the market at 68$ per share for four central reasons.
-The first driver of our valuation regards Under Armours position within the sportswear apparal market, how does Under Armour differentiate itself from their competitors and gain market share within the sports apparel and equipment industry?
-The second driver of our valuation growth examines how Under armour leads innovation in their industry.
-The third driver assesses opportunities of growth for Under Armour as they expand abroad, enter new markets, and the potential risks associated with these strategies. their creation of new products, strategies for expanding internationally, and the efforts to capture the growing market of athletic leisure apparal for women.
For these three reasons, we recognize that Under Armour would need to sustain, what we believe is an unsustainable long term growth rate, thus making their stock currently over valued.
Next, Julia will expand on Under Armours role within their market.
Graph shows compound annual growth rate over the past 4 years and our projections
Cagr= 27.96% and 21.5%
----- Meeting Notes (7/6/15 21:52) -----
Under Armour growth rate 20%, leading the industry
Expected under 2015
Include total size for each bar (100m, ex)
Label CAGR for both percentages
Split into 2 slides
This should be the first slide but for the whole market!
----- Meeting Notes (7/8/15 11:51) -----
Use the same wording as in the previous slide in the title
----- Meeting Notes (7/8/15 15:42) -----
Fix title
----- Meeting Notes (7/8/15 20:38) -----
HACE FRIO
-CEO and founder of Under Armour, Kevin Plank incorporated the company in Baltimore, Maryland in 1996.
- As a former University of Maryland football player, Plank noticed that compression shorts worn during practice and games stayed drier than any other sports apparel.
-Plank used the same moisture wicking material of the compression shorts he wore so often in his collegiate football career to create other compression apparel items that regulate body temperature by wicking sweat away, optimizing comfort, mobility and performance for athletes and active persons alike.
-After dipping $40,000 into credit card debt to fund his idea, Plank scored his first sale to Georgia Tech for $17,000, marking the start of a billion dollar business and the signature under armour compression shirt.
-Under Armour creates high quality branded performance apparel, footwear, and accessories for men, women, and youth. Under Armour specifically engineers fabrics and designs that enhance performance for athletes at all levels and consumers with active lifestyles. The brand’s signature moisture-wicking fabrics come in various styles, worn on basketball courts to playing fields around the world.
-Since its inception, Under Armour has represented the hard working, gritty, and determined athlete. Quality, performance enhancing sports apparel made for those who take to the field with passion.
-Summed up pretty concisely by one of their most popular tag line’s, Under Armour’s trademark “I Will” encapsulates the brand’s unique position as a leading supplier of high quality sports products for athletes of all levels.
Heatgear
HEATGEAR® is engineered with a microfiber blend designed to wick moisture from the body which helps the body stay cool, dry and light. (10K)
Coldgear
COLDGEAR® is designed to wick moisture from the body while circulating body heat from hot spots to help maintain core body temperature.
Allseasongear
ALLSEASONGEAR® is designed to be worn in between extreme temperatures and uses technical fabrics to keep the wearer cool and dry in warmer temperatures while preventing a chill in cooler temperatures.
Within each gearline apparel comes in three fit types
Compression
Fitted
Loose
Footwear offerings include football, baseball, lacrosse, softball and soccer cleats, slides and performance training, running, basketball and outdoor footwear
Footwear is light, breathable and built with performance attributes for athletes.
It is designed with innovative technologies which provide stabilization, directional cushioning and moisture management engineered to maximize the athlete’s comfort and control
Accessories primarily includes the sale of headwear, bags and gloves. Our accessories include HEATGEAR® and COLDGEAR® technologies and are designed with advanced fabrications to provide the same level of performance as our other products.
Show the story behind the company 30-40 seconds--give intro to the company
What is the company and what do they sell?
----- Meeting Notes (7/8/15 11:51) -----
Take out the numbers--should be a softer intro.
Put this into the appendix
Health and fitness devices: Led by the popularity of activity tracking devices, health and fitness devices will lead unit sales among all wearables in 2015 with a projected 20 million units. Revenue is expected to surpass $1.8 billion in 2015. (https://www.ce.org/News/News-Releases/Press-Releases/2014/Record-Breaking-Year-Ahead-CEA-Reports-Industry-Re.aspx)
“consumer revolution in healthcare. Consumers want faster, easier, self-serivce ways to manage and improve their helath- a trend that will continue to increase. By 2017, it is estimated that 1.7 billion smartphones and tablets wll have an m-helath app installed.” “companies outside the traditional consumer health industry are entering the arket to fufill the unmet needs of the health oriented consumer… these companies are entering into the market to respond to the connected consumer who wants to better manage their health.” https://www.accenture.com/t20150523T041535__w__/us-en/_acnmedia/Accenture/Conversion-Assets/DotCom/Documents/Global/PDF/Industries_13/Accenture-Changing-Future-of-Consumer-Health-High-Performance-Business-Study-2013-Update-Infographic.pdf
UA is attempting to create the “Fitness Network,” similar to Facebook’s social network or LinkedIn’s business network. Recent acquisitions Endomondo and MyFitnessPal have expanded UA’s reach to 120M users across three separate apps. The apps help consumers track their health and fitness. UA’s new, 4th app, “UA Record,” is an effort to blend the three apps into one big community.
Building a big online community likely helps UA sell more athletic apparel and footwear: We believe a fitness network can help UA by 1) increasing awareness of and loyalty toward the Under Armour brand; and 2) motivating consumers to workout more, which ultimately drives category sales. This is a worthy pursuit in our view. We assume in our base case the apps are marketing expenses which help drive UA’s core business. Our 20+% long-term UA sales CAGR outlook remains intact.
Adding $7 to our bull case: If UA can monetize the network beyond apparel & footwear, we see $5-10B potential value creation. UA has only $45-60M in digital sales today, but networks can grow very fast. Facebook, LinkedIn, Twitter, etc. averaged 123% 4-year sales CAGRs from the time they were roughly the size of UA’s digital business. If UA can grow like the others, we see $500M-$1B in potential sales valued at 10x in four years (Exhibit 1). We discount that value back and add it to our existing bull case to arrive at our change.
Facebook had 890 million daily active users on average in December 2014. LinkedIn has 347 million members as of 2/5/2015. Twitter had 240 million monthly active users as of its last 10K. Yelp had approximately 120 million unique visitors to its website on a monthly average basis during the quarter ended December 31, 2013.
Nevertheless, UA's mission is to reach critical mass. Plus, UA must be first. It is likely in a race with Nike and others to achieve the “first mover advantage” and build the definitive fitness network. Therefore the near-term goal is integrating the three communities by promoting Under Armour Record as an aggregator/dashboard app. if UA can achieve a critical mass of users. One basic premise UA is basing its digital strategy on - if it knows more about its consumers, it can sell them more stuff, is applicable across many industries, not just apparel and footwear. If UA can build and maintain a large, active community of health & fitness enthusiasts, why wouldn't personal trainers, fitness event promotors, nutrition companies, sports equipment companies, grocers, health care providers, etc. all want to know what these people are doing so they can sell them more stuff too? There are many, many more possibilities. The point is for these companies to gain access to the data generated by UA's network, they will likely have to compensate UA. This is one way UA can monetize the network beyond apparel and footwear.
evolution of health lifestyle industry, huge size, big potential
“consumer revolution in healthcare. Consumers want faster, easier, self-serivce ways to manage and improve their helath- a trend that will continue to increase. By 2017, it is estimated that 1.7 billion smartphones and tablets wll have an m-helath app installed.” “companies outside the traditional consumer health industry are entering the arket to fufill the unmet needs of the health oriented consumer… these companies are entering into the market to respond to the connected consumer who wants to better manage their health.” https://www.accenture.com/t20150523T041535__w__/us-en/_acnmedia/Accenture/Conversion-Assets/DotCom/Documents/Global/PDF/Industries_13/Accenture-Changing-Future-of-Consumer-Health-High-Performance-Business-Study-2013-Update-Infographic.pdf
----- Meeting Notes (7/7/15 21:17) -----
Just have a slide with a description of the product
----- Meeting Notes (7/6/15 21:52) -----
Consider using the 100% stock bar format
See if this looks better
Include average industry line
Bottom horizontal line
68% of consumers prefer athletic clothing made of cotton
----- Meeting Notes (7/7/15 21:17) -----
Care more that UA is tailoring their apparel to these preferences
By 2017, it is estimated that 1.7 billion smartphones and tablets wll have an m-helath app installed.” “companies outside the traditional consumer health industry are entering the arket to fufill the unmet needs of the health oriented consumer… these companies are entering into the market to respond to the connected consumer who wants to better manage their health.” https://www.accenture.com/t20150523T041535__w__/us-en/_acnmedia/Accenture/Conversion-Assets/DotCom/Documents/Global/PDF/Industries_13/Accenture-Changing-Future-of-Consumer-Health-High-Performance-Business-Study-2013-Update-Infographic.pdf
-CEO and founder of Under Armour, Kevin Plank incorporated the company in Baltimore, Maryland in 1996.
- As a former University of Maryland football player, Plank noticed that compression shorts worn during practice and games stayed drier than any other sports apparel.
-Plank used the same moisture wicking material of the compression shorts he wore so often in his collegiate football career to create other compression apparel items that regulate body temperature by wicking sweat away, optimizing comfort, mobility and performance for athletes and active persons alike.
-After dipping $40,000 into credit card debt to fund his idea, Plank scored his first sale to Georgia Tech for $17,000, marking the start of a billion dollar business and the signature under armour compression shirt.
-Under Armour creates high quality branded performance apparel, footwear, and accessories for men, women, and youth. Under Armour specifically engineers fabrics and designs that enhance performance for athletes at all levels and consumers with active lifestyles. The brand’s signature moisture-wicking fabrics come in various styles, worn on basketball courts to playing fields around the world.
-Since its inception, Under Armour has represented the hard working, gritty, and determined athlete. Quality, performance enhancing sports apparel made for those who take to the field with passion.
-Summed up pretty concisely by one of their most popular tag line’s, Under Armour’s trademark “I Will” encapsulates the brand’s unique position as a leading supplier of high quality sports products for athletes of all levels.
----- Meeting Notes (7/8/15 15:42) -----
Delete the tracker, bro
----- Meeting Notes (7/8/15 22:50) -----
Good job mia! shorten it maybe?
Heatgear
HEATGEAR® is engineered with a microfiber blend designed to wick moisture from the body which helps the body stay cool, dry and light. (10K)
Coldgear
COLDGEAR® is designed to wick moisture from the body while circulating body heat from hot spots to help maintain core body temperature.
Allseasongear
ALLSEASONGEAR® is designed to be worn in between extreme temperatures and uses technical fabrics to keep the wearer cool and dry in warmer temperatures while preventing a chill in cooler temperatures.
Footwear offerings include football, baseball, lacrosse, softball and soccer cleats, slides and performance training, running, basketball and outdoor footwear
Footwear is light, breathable and built with performance attributes for athletes.
It is designed with innovative technologies which provide stabilization, directional cushioning and moisture management engineered to maximize the athlete’s comfort and control
Accessories primarily includes the sale of headwear, bags and gloves. Our accessories include HEATGEAR® and COLDGEAR® technologies and are designed with advanced fabrications to provide the same level of performance as our other products.
----- Meeting Notes (7/6/15 21:52) -----
Year, pictures, replace with an informal slide
----- Meeting Notes (7/7/15 20:42) -----
What is the point that we are going for? Apparel is the most important. How has this been changing? Maybe not the best slide to start.
----- Meeting Notes (7/7/15 23:20) -----
This is more just a breakdown of revenues
Make technology the focus of this slide
----- Meeting Notes (7/8/15 22:50) -----
took a little long. emphasize important message
----- Meeting Notes (7/8/15 19:44) -----
PUT BEFORE INTL REVENUE SLIDE, add source! (make sign bigger by how many in each location?)