Under Armour Stock Crashes! Is it a Buy?

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Doing subscribers thank you so much for joining me today i am jeremy this is the financial education channel and today we’re talking about under armour stock under armour stock has just hit its 52-week low today this stock has just been crashing for a while and now it is the lowest it’s ever been today it hit $17.90 which would be the lowest the price has ever been

In last 52 weeks the lowest price has been in the last few years guys this is just a disaster stock at the moment so we got a look at this stock and say is it a buy guys should we be buying under armour should we be shorting under armour or should we just not even touch this one so first off what we got to talk about here is under armour ceo basically made national

News yesterday i hate it when ceos make national news you know why because usually has something to do with politics usually they said something or did something in that town national news so under armour ceo ignites boycott threats after resigning from trump council under armour ceo kevin plank resigned from president trump’s manufacturing council monday amid

Growing scrutiny over trump’s response to the violent white nationalist rally in charlottesville virginia so it’s been very interesting every time a ceo makes national news it’s almost always because they said something politically that or they did something politically they made a move that a lot of people didn’t like it and made national news i remember steve

Wynn used to make national news a lot of times when obama was president so there was this whole story that blew up in national news about george clooney storms off they were having dinner or something steve wynn called obama an and then there was this is back in 2011 when ceo i remember i was on this conference called when he did this and this wasn’t the only

Conference call he went off on obama but this is one of them when ceo goes on epic anti obama rant on a company conference call so the reason steve wynn could kind of get away with doing that is because you got to understand what steve wynn’s business 80% plus of his business as far as the profits and the revenues that are come into that business or asian related

There from customers from china and things like that like mchale 100% asian right and that’s 75 percent of wins businesses is macau right and then even though big the las vegas business is people coming from hong kong and singapore in all these different countries that have tons of money and they go gamble i’ve been to the wind i mean i go to the win at least once

Or twice a month because i live here in las vegas so i go over there i just observed thing i just walk around you know do whatever have a drink and just walk around right every single the wind has a high limit like rooms like high limit rooms where you have to bet at least like $1,000 at $10,000 plus a hand right every single time i have ever ever in the history

Been to win or encore looked in the high-limit rooms i’ve never once seen a white person in there never once seen a black person there never once seeing someone from latin america in one of those rooms every single time and i am not exaggerating every single time it’s an asian person who doesn’t even know how to speak english that’s a hundred percent of time so

Wing could get away with you know calling obama names and you know saying you know going off on obama and those kinds of things because he didn’t have to he his customers his name the majority of his customers don’t give an f whether he’s a republican democrat what he said about that as long as he’s got the back of china and steve went oh believe me he says nothing

But good things about china all time as he should because he gets the majority of his company’s revenue from china and profits from china and as a ceo your number one thing you have to look out for your number one thing over everything when you sign up to be a ceo and you hire employees those employees are your number one focus or should be your number one focus

Over everything you’ve got to realize every decision you make whether it’s politically related whether you want to go to the you know drinking and driving like don’t matter what you’re doing those decisions come down to your employees and you will be judged if something makes national news and you have the chance to lose massive amounts of employees jobs and those

Employees has families those employees have family so your decision making a ceo whether you think oh this is great that i’m doing this this is great that i’m saying this or doing that just realize it has potential repercussions i know people literally that would not watch an nfl game last year because colin kaepernick sat down during the national but i always

Stand up to the national anthem don’t matter what i don’t care if i got a cramp in my ass i don’t care my hamstrings torn i’m standing up but i don’t give a rat’s crap if colin kapernick was standing up or sitting down i’m still watching mfl games like that’s not you know that’s the beautiful thing about the united states of america you want to do that you can do

That and you don’t have to get shot in the head like if you did that north korea good luck they’re going to take you out back and shoot you in the head right and that’s the beauty about united states you can do that in there’s no repercussions as far as like you’re going to be you know tortured or something like that that’s my opinion but there were massive

Amounts of people that did not watch nfl last year in rating went down for nfl games last year simply because colin kaepernick and the whole controversy and nfl never suspended him and so tons of people that felt like what the nfl was in the wrong literally boycott at the nfl last year in ratings went down and for nfl after ratings have been exploding for years

And i thought i mean you look at what the ratings were for some of those main games guys they were down drastically so when i look at this now i see a potential of a lot of backlash coming toward under armour you got to understand hates a lot stronger than love so just because you know a ceo comes out against something doesn’t mean all these people are going to

Run in and go buy under armour products now generally that hates much stronger but people will boycott it so now you see a nike hat there you see an under armor hat and i can guarantee you a lot of trump supporters now will not buy the under armour hat even though they might have under armour out the place before for their for themselves and their kids now they’re

Going to probably go for that nike hat guys and that is the reality and you know under armour’s already had to do job cuts and job layoffs and whatnot and we’ll see if they have to end up doing more because of this but your number one focus when you sign up for ceo you start hire employees is those employees and you’ve got to look out for them over everything guys

So it’s crazy to see you know ceos want to get involved with this or that and try to make you’re not a commentator when you’re a ceo your your job is to expand the business and make sure those employees have jobs and hopefully they get raises every few years because guess what no one’s going to give those employees a job the government ain’t going to give those

People a job and if the all the jobs the government give you what it comes from tax revenue from business owners and employees so if you don’t have the business owner so you want employees and people don’t have jobs then you don’t have anything your frickin entire country is a joke at the end of the day it all comes down to business owners and it all comes down

To employees at the end of the day they’re the ones that make the whole thing happen guys so that’s just something to take into account so now let’s really look at this stock this stock obviously we’re just talking about it’s at its 52-week low trailing p/e is a 45 on this one guys a 45 and you look at the forward p/e is a 40 so right off the bat i’m like holy

Smokes this company is trading at an insane multiple i mean we’re talking about 45 trailing p/e but look at the the forward tees only a 40 guy’s a 40 that’s super high and that’s like not they’re not expected to be much more profitable over the next 12 months and they were the last 12 months when you go from a 45 to 40 that’s not that great if you go from a 45

To say like a 26 or 22 or something like maybe a facebook does then that’s impressive but this isn’t that good guys so let’s look at some some numbers behind on over here so revenue was up 9% to 1.1 billion that’s pretty good up 8% currency neutral so that’s i mean revenue up 90% that’s good but when you’ve got a company trading in in the 40s for a multiple 9%

Isn’t that impressive guys we can see here if we look at the updated 2017 outlook and this is what i really like to look at net revenue is expected to grow nine to 11 percent versus previous expectations of 11 to 12 percent so they’re expecting growth to not be nearly what they had previously thought reflecting moderation in the company’s north american business and

The company’s north american business you got to understand under armour sells mainly to people in north america some people in north america are very divided politically right so just some things that take into account here gross margin or report basis is expected to be down approximately 160 basis points compared to 46 point 4 percent in 2016 on a reported basis

Incomings expected to reach approximately 160 to 180 million not that good for a company that has the market cap this one does excluding the impact of a restructuring plan adjusted operating income expected to be 280 to 300 million interest and other expense net is approximately 40 million on a reported basis full-year diluted earnings per share is expected to be

18 cents to 21 cents excluding the impact of the restructuring plan full-year by the way the restructuring plan is like – i think they’re cutting about 250 jobs full-year adjusted diluted earnings per share is expected to reach 37 to 40 cents guys so correctly not that great let’s look at this here cash and cash equivalents is on the balance sheet let’s look at the

Balance sheet here so 165 million they got in cash then if you go to other long-term assets so that’s probably you know they could categorize out as many different things that’s probably their long-term investments they’re about 87 million so it’s not bad but then if we go down and we look here at the long-term debt they got seven hundred and seventy seven million

Dollars in long-term debt so they have more in debt than they have in cash in investments that’s always a bad time for me looking at a company especially when it’s business-to-consumer just a thing i do not like it’s not like they’re in a super capital intensive business at the end of the day then we look at this guy so making you reported earnings at oh dayton

Or not the other day a couple weeks ago and nice an earnings were sneaking in a sixty cents versus analyst were expected for fifty cents of earnings revenue also beat at eight point six eight billion versus eight point three eight billion so you know look at this nike continues to create both near-term wins in today’s dynamic environment and lasting foundation for

Future growth ceo parker said so nike has got some phenomenal growth and then i looked into this and i was like you know it didn’t you know the nike founder phil knight the kind of guy that like you know the head of the company as far as you know the figurehead of the company the one that founded has he have really gotten in anything politically as far as national

News and this is like most this is like the most nationalist news i could see from him and it was like back page story type stuff nike founder phil knight isn’t feeling the bern he talks about how i do believe that the international trade agreements benefit both nations always nate pointing to north american free trade agreement everybody railing on nafta right

Now but since 1996 when we signed nafta the gross national product of the united states has risen three times do we really think it has gone up more than it hasn’t gone up more than that if we didn’t have the trade agreement so that was like the biggest news story and that was like a backpage type stuff so it’s interesting you know the under armor ceo is making

This national political news in the company is struggling and then nike nike you know the face of nike the cofounder phil knight you know he’s kind of stayed away from a lot of this stuff and suddenly nike is doing great so i don’t know maybe it has nothing it could have absolutely nothing to do with politics it could not i just think it’s very important to pay

Attention to these things because i used to be a little on that even think like you know people don’t really care like if you come out this way or that way and then i learned and i met people in real life who will literally not support certain companies because that company had you know a ceo that said something against what there’s what their president was or what

Their congressman was or whatever guys so something to take into account there so tell me if you’re buying under armour stock right now i’m absolutely not buying this company it’s got ridiculously high trailing p/e and 40 it’s not expected to be much more profitable there in national news for the wrong type of headlines you know you never want to get involved in

Politics you’re you’re losing your employees jobs that are now going to have to be on government probably government plans right or tough to get a job somewhere else or something like that never a good look man your number one focus as a ceo is those employees jobs at the end of the day and their families are counting on you you know your company being able to

Put food on the table each day so that’s why i have to say about that if you just came across this channel you may want to subscribe we talked personal finance in the channel we talked entrepreneurship i’m an actual business owner i give away so many business tips we talk stock market investing more than anything thank you for watching guys and have a great day you

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Under Armour Stock Crashes! Is it a Buy? By Financial Education