Under Armour Inc (NYSE:UA) seems to have learnt the art of picking up of winning players among the athletes. Its CEO, Kevin Plank, has been credited for picking up the winners. That might be due to his experience in managing whatever he does. After delivering 20% Plus growth for the 21st straight quarter, the company is setting its next objective very obvious. That is to take on Nike Inc (NYSE:NKE) in their own yard stick, i.e. basketball shoe market.
Market Leader
It is not going to be easy for Under Armour Inc (NYSE:UA) to take the market leader in its own strong area. However, they may not have anything to lose but only to gain. That is primarily because 90% of the basketball shoe market is controlled by Nike Inc (NYSE:NKE) currently. That comes with the big success of its brand, Air Jordan. They have Curry One brand under its kitty to fight with.
BB&T Capital Markets analyst, Corinna Freedman and other analysts are watching the shoe sales trend in the United States. The analyst believes that the momentum is there for Under Armour. There was no doubt that the company is enjoying credible success in this current year and that it should also help its sales next year. It will also be quite interesting to see how the brand is performing in the American market going forward.
Enough Room To Play
There appears to enough space for both Under Armour Inc (NYSE:UA) and Nike Inc (NYSE:NKE) to play in several segments of the sports. That’s why these two stocks were also hitting highs even as the citizens were moving towards the ‘athleisure’ wear. However, it would be tough to compare on sales.
While Under Armour Inc (NYSE:UA)’s estimated sales in 2015 is a shade less than $4 billion, Nike Inc (NYSE:NKE) sale is predicted to be $31 billion. That is a big gap and reflected in the market cap also. That suggests that the company needs to go a long way to giving a run for money to its giant rival.
Under Armour, Inc., incorporated on July 01, 1996, is engaged in the development, marketing and distribution of branded performance apparel, footwear and accessories for men, women and youth. The Company’s moisture-wicking fabrications are engineered in a range of designs and styles for wear in nearly every climate to provide an alternative to traditional products. The Company’s operating segments include North America, consisting of the United States and Canada; Europe, the Middle East and Africa (EMEA); Asia-Pacific; Latin America, and MapMyFitness. The Company also offers digital fitness platform licenses and subscriptions, along with digital advertising through its MapMyFitness business.
The Company sell its branded apparel, footwear and accessories in North America through its wholesale and direct to consumer channels. As of December 31, 2014, the Company had 125 factory house stores and five brand house stores in North America. The Company distributes the majority of its products sold to its North American wholesale customers and its brand and factory house stores from distribution facilities it leases and operates in California and Maryland. In addition, the Company distributes its products in North America through third-party logistics providers with primary locations in Canada, New Jersey and Florida. The Company sells its apparel, footwear and accessories through retailers and Websites and independent distributors in certain European countries. It also sells its branded products to various sports clubs and teams in Europe. The Company generally distributes its products to retail customers and e-commerce consumers in Europe through a third-party logistics provider based out of Venlo, The Netherlands.
The Company sells its apparel, footwear and accessories products in China through seven brand and two factory house stores that it operates along with stores operated by its distribution partners. It also sells its products to independent distributors in Australia, New Zealand, Taiwan and Hong Kong. The Company distributes its products in Asia-Pacific primarily through a third-party logistics provider based out of Hong Kong. It has a license agreement with Dome Corporation, which produces, markets and sells its branded apparel, footwear and accessories in Japan and Korea. The Company’s branded products are sold in Japan and Korea to sporting goods retailers, independent specialty stores and professional sports teams, and through Dome-owned retail stores. The Company sells its products in Chile, Mexico and Brazil through wholesale distributors, Website operations and two brand and six factory house stores. In these countries, the Company operates through third-party distribution facilities. In other Latin American countries, the Company sells its products through independent distributors which are sourced through its international distribution hubs in Hong Kong, Jordan and the United States.
Apparel
The Company’s apparel is offered in a variety of styles and fits. Its apparel is engineered to replace traditional non-performance fabrics in the world of athletics and fitness with performance alternatives designed and merchandised along gearlines. Its three gearlines include HEATGEAR, COLDGEAR and ALLSEASONGEAR. Within each gearline, its apparel comes in three primary fit types: compression (tight fit), fitted (athletic fit) and loose (relaxed). HEATGEAR is designed to be worn in warm to hot temperatures under equipment or as a single layer. COLDGEAR is designed to wick moisture from the body while circulating body heat from hot spots to help maintain core body temperature. Its COLDGEAR apparel provides both dryness and warmth in a single light layer that can be worn beneath a jersey, uniform, protective gear or ski-vest. 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
The Company’s footwear offerings include football, baseball, lacrosse, softball and soccer cleats, slides and performance training, running, basketball and outdoor footwear. Its footwear is designed with technologies, which provide stabilization, directional cushioning and moisture management for the athlete’s comfort and control.
Accessories
The Company’s accessories primarily include the sale of headwear, bags and gloves. Its accessories include HEATGEAR and COLDGEAR technologies.
The Company competes with Nike and adidas.
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