Under Armour (UA)

Has a Short position on this because it has much weaker price momentum. More importantly, they really don’t have the type of valuation metric that Nike (NKE-N) has. The balance sheet is fine and they beat on a recent quarter, but ROE’s are low and they really aren’t cash flowing.

Not a category he would go into. Retail is getting beaten up pretty badly. He likes their products. There is so much you have to get through to make this a successful investment.

He would not be an investor at this time. The technology they put into their gear is fantastic. This is an example of a stock that he really likes, but wouldn’t touch. You are going to face a raft of sellers who will be looking to get their money back when a stock starts moving up. Also, a lot of sales are still coming through brick-and-mortar storefronts, which are facing a challenge.

North America is where they have seen their weaker growth. International results were stronger. This and Nike (NKE-N) are really in a league of their own when it comes to apparel manufacturers. They command such a multiple premium on their valuation side. We have had such a strong trend in at-leisure with a lot of new entrants coming online and a lot of knock off brands. She wonders if the extra capacity is there and we get a reversal in consumer product preferences.

The stock was down 25% post its earnings but he does not think the valuation is attractive enough. Apparel cannot grow forever. Retail is under a lot of pressure. UA-N is trying to grow internationally and that is good. Wait a little while longer to get it at a better price. (Analysts’ target $21.)

This is going to have to break through some of its resistance levels to begin to even look like something you want to look at. It consolidated at around $25, and everybody that bought in that range is going to want to get out, so you are going to run into a wall of sellers. There are much greener pastures. It is also into a tough retail environment.

It is like a number of faddish US stocks. It is overvalued, but loved. He would not endorse it. He thinks Trump could do all kinds of damage. This is off his buy list.

Seasonality is October 28 until Black Friday. They also do well from Jan 23 to April. People are interested in retail stocks when something is about to happen. It has dropped back to lows of earlier this year. Give it a bit of lee way and see if it begins to pick up. He has not entered the retail sector because he has not yet seen the strength for this year. XRT-N, the ETF has started to go up but this one has not, so that is not a good sign.

Terrific CEO. They married apparel with technology. All big companies look expensive at the beginning of their story. This could be a double or triple.

Nike (NKE-N) or Under Armour (UA-N)? If you are older than 25, you are probably still a Nike person. If you are under 25, you are probably with this one. In terms of going forward, you are probably going to go with this because it looks like they are going to have a better growth rate. Valuations on both are high, so he wouldn’t rush out to buy. Valuations on both are far too extended right now.

A higher growth story, but the whole group is at a valuation premium. Although the company is doing well today, if the growth model and valuations don’t come through, you are paying a lot today for what the company looks like a few years from now. That always makes her nervous in protecting capital.

Doesn’t know that their multiple is justified. The growth rate is still there and he doesn’t know that there is much at risk as some of the other players in the industry. If you are okay for some risk in the short term, it’s not bad, but he wouldn’t have a full position in it. They are taking market share away from Nike (NKE-N).

Has liked this for some time and sees it as a company that is able to take advantage of a longer-term trend of fitness. They are currently one of the leaders. Have been able to get some really strong endorsements. One of those companies that is going to continue to execute, so any dips you see is an opportunity.

(Market Call Minute.) Loves the company. A fantastic company, but a little too expensive.

A great and exciting brand. Have a lot of top-notch athletes they have signed to the label. Most of the younger kids coming up and playing sports are under this label. It is also benefiting from the overall athletic trend for people who are looking for the sporty look. Thinks the market is expecting 25% growth in earnings this year, and yet there is still a 60X earnings multiple on the stock. When you get into these types of valuations, a lot of the excitement is already priced in. A bit rich for her.