Nike Vs Under Armour

Nike Vs. Under Armour

Analyzing two "like companies" and deciding which one is the better investment option is a difficult task for a person who knows very little about the stock market and investing. With this in mind, I will compare two like companies; Nike and Under Armour. I ventured to the internet and asked Google to tell me what to look for in these companies. I will discuss the companies' accomplishments, goals, and expansion.

Under Armour is less established in years in the market, however it a very fast growing company. Under Armour is a "middle sized" company at $3.1 Billion dollars. In other words, it is 1/10th the size of Nike. Though small, it is Nike's fastest growing rival. Under Armour's CEO says that they will be bigger than Nike someday, however given no definite timeline. They issued a 2020 plan stating that they will grow their revenue through internal expansion (they recently borrowed three hundred million dollars in capital to buy corporate headquarters in Baltimore for expansion), and "new product categories".

Their numbers look appealing to an investor that is willing to take a risk. One website sited their fast pace growth is expected to be between 25%-27% in 2011. Their apparel line is up around 35% and 32% over the year. The company is attempting to jump into foot wear/basketball and expand into the internal market as well. In 2008, 95% of all sales were coming from North America. Their market is looks great in North America, up 28% this quarter, and up 21% overall in 2011.

There does appear to be some negatives with the company. Though they are attempting to adventure into basketball items, consumers still flock toward Nike. Currently only 16% of their revenue comes from footwear and 4% in the international market. They make good shoes;

Nike Vs. Under Armour 3

however they do not carry a great selling strategy with well-known athletes like Nike does. Yes they are growing outside North America by 36%, but this still makes up less than 15% of total revenue.

Nike follows a simple theme; if you have a body you are an athlete. Nike is a $35 Billion dollar company. It falls under the "Large Cap Growth" category and is one of the largest companies in the world, dominating sale of athletic footwear, apparel and equipment in the world. Nike has around $7 billion in sales and controls roughly 95% of the basketball market; the same market Under Armor is attempting to sneak into. They operate in 160 countries around the world and have nearly 1 million employees. They have a revenue goal for 2015 of $20.9 billion; showing increases in countries in Eastern Europe, Greater China and Japan. Nike does 65% of their sales outside the U.S., compared to the 4% noted earlier with Under Armour. They are quite simply the "Goliath" of