Nike and Under Armour Stepping Up Their Competitive Spirit

NEW YORK, NY / ACCESSWIRE / March 27, 2017 / Shoe retailers have experienced a number of challenges growing from consumer demand and retail locations. Both companies have been hit with troubling earnings numbers, and they plan to act to re-engage customers and re-establish investor confidence.

RDI Initiates
Coverage:

Under Armour Inc. https://ub.rdinvesting.com/news/?ticker=UA

Nike Inc. https://ub.rdinvesting.com/news/?ticker=NKE

Under Armour advanced 4.13% to close at $18.16 on Friday. The stock traded between $18.52 and $17.98 on volume of 6.70 million shares traded. The upward movement is a bit of a surprise given the recent bad news for investors. The head of finance, Chip Molloy, left after only a single year on the job, eroding investor confidence. Their corporate bonds were reduced to junk bond status by Standard and Poor’s, reducing it to BB-plus rating. The rating company also gave Under Armour a negative outlook status, so yet another drop in its rating is possible.

However, the other major ratings company, Moody’s bumped the company’s outlook down from “stable” to “negative” but did chose not to downgrade its corporate bond rating. One possible reason for Moody’s patience is Under Armour’s entry into the high fashion segment. Its new $300 ArchiTect Futurist shoe to be launched on March 30th, has a “next-gen design” that comes with a number of high-tech features such as its 3D-printed midsole, which promises its buyers “infinite cushioning and support” for their feet.

Access RDI’s Under Armour Research Report at:
https://ub.rdinvesting.com/news/?ticker=UA

Nike stock advanced $1.79 to close at $56.36 on Friday. The stock traded in a relatively narrow range between $56.64 and $55.12 on volume of 14.44 million shares traded. The company met their revenue expectations in their latest financial report, but there was a loss in sales that was offset by savings in administrative costs and lower taxes paid. While this caused the stock to take a dip earlier in the week, Friday’s close makes room for optimism. The company has labeled its most recent efforts to spur sales as a “triple double”: – targeting innovation, supply chain speed of delivery, and engaging consumers through the offering of digital memberships.

In corporate news, one-time member of Barron’s Top 30 of the Best CEOs, Nike’s Mark Parker, lost his place on the latest list. Parker remains one of the world’s top CEO’s, but the bankruptcy filing of retail outlet The Sports Authority were a drag on the company’s performance.

Access RDI’s Nike Research Report at: https://ub.rdinvesting.com/news/?ticker=NKE

Our Actionable Research on Under Armour Inc. (NYSE: UA) and Nike (NYSE: NKE) can be downloaded free of charge at Research Driven Investing.

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Disclaimer: This article is written by an independent contributor of RDInvesting.com and reviewed by Nadia Noorani, CFA® charter holder. RDInvesting.com is neither a registered broker dealer nor a registered investment advisor. For more information, please read our full disclaimer at www.rdinvesting.com/disclaimer.

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