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Kevin Plank: It Was A Mistake To Bet Against Tom Brady And A Mistake To Bet Against Under Armour

Kevin Plank: It Was A Mistake To Bet Against Tom Brady And A Mistake To Bet Against Under Armour

Shares of Under Armour Inc (NYSE: UA) (NYSE: UAA) are off nearly 30 percent in 2017. The stock was hit after its fourth-quarter earnings report not only fell short of what investors had expected, but contained the surprise announcement chief financial officer Chip Molloy will be leaving the company.

Under Armour CEO Kevin Plank was a guest on CNBC's "Halftime Report" Tuesday in an attempt to reassure investors that the company remains a strong growth story.

No One-Trick Pony

Plank's main pitch to investors was that his management team is among one of the most solid and experienced within the athletic apparel space. Under Armour certainly isn't a fly-by-night company and has been around for more than two decades and a public company for 11 of those years. He elaborated what Under Armour needs to do better, and highlighted that the company has ways to streamline the business in a more efficient way while sticking to an aggressive growth strategy.

CNBC's Scott Wapner peppered Plank with multiple questions regarding the company's momentum and growth up until this report; Plank responded that he never wanted the company to be a "one-trick pony "regarding its athlesiure focus, but it takes a longer time to turn a bigger ship.

One of the points Plank highlighted was that North America was a difficult area for the retail space. Specifically, he believes the company wasn't as aggressive as it could have been and that retail for the most part has been a dismal experience for many people. In 2017, Plank said you will see a common theme for Under Armour "Make UA Simple."

Plank did point out, however, that the single largest issue facing retail is the proposed border tax adjustment by the Trump administration.

Don't Bet Against Under Armour...

"A lot of people bet against Tom Brady the other night," Plank said. "Wall street can count on us, they've always been able to count on us, this is the same growth company that people once knew."

Wapner asked if Plank would institute a buyback and he responded that the company wasn't looking to buyback stock. When pressed by Wapner on whether he himself would buyback stock, Plank reiterated that he's the company's largest shareholder, and had multiple opportunities to sell stock, but didn't.

...Or Detroit

Plank said Under Armour's growth strategy is to attack, and one way the company is planning to attack is the new store opening in downtown Detroit. The store is expected to open this Spring, but there has yet to be a confirmed date. Detroit's Campus Martius area recently saw investment from Under Armour's main competitor, Nike Inc (NYSE: NKE), which opened a retail store in May 2016. What's clear to large players in the athletic retailer space, is that Detroit is a key location to bring back growth to North America sales.

Plank says to not bet against Under Armour, and from all indications, he's not betting against Detroit either.

Latest Ratings for UAA

Sep 2019MaintainsNeutral
Sep 2019MaintainsNeutral
Sep 2019UpgradesUnderperformMarket Perform

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