EQUITY RESEARCH: UNDER ARMOUR, INC.

The objective of this report is to study and provide an investment recommendation for Under Armour, Inc. This report is based on public information available until 1st of August 2021 and it was developed according to the CFA Institute recommendation for the CFA Research Challenge. Under Armour, Inc. is an American company engaged in the development, marketing and distribution of branded sports performance and casual apparel, footwear and accessories for men, women and youth. During the course of Equity Research I had the opportunity to study this industry, which helped better understand its ins and outs. Under Armour’s valuation was calculated using a Weighted Average Cost of Capital (WACC) Method through Free Cash Flow to the Firm (FCFF) for the industry, complemented with the Adjusted Present Value (APV) and a Relative Multiples Valuation. At the end, the recommendation of this report is to sell the common share, with a price target of $ 9.62 per share, in the end of 2021, representing a potential downside of 49.11%, when compared to the price of the common share at the time of this report’s elaboration. This recommendation is based on a high level of risk, as the company operates in a very saturated market, with low operating margins, where supply is extremely high, and where its power of branding and marketing is not as strong as some of its competitors.