Mr. Tom Cassidy

GLG News by Mr. Tom Cassidy, Independent Consultant

Under Armour---Over or Under?

May 21, 2009

Analysis of:Under Armour is Everywhere | www.fool.com

Under Armour has been the darling athletic stock of this decade.  The big question now is if they can keep the momentum rolling.  Are they the real deal with a tremendous future, or have we seen the best of them? The article posted on the Motley Fool site paints a very positive picture.  Is the premise for prosperity warranted? My analysis will focus on some of the key reasons I feel UA is at more risk than suggested by the writer of this article.  

The Combination to Foot Locker

October 20, 2008

Analysis of:Ahead of the Bell: Food Locker | www.forbes.com

Foot Locker has had more than it's share of problems over the past couple of years.  For those of us who have been around for a long time, their performance has been a wake-up call to the leader of the industry. The author makes some very critical points in the article which lead to support the future direction of the retailer Foot Locker.  The key points need to be reviewed to decipher if the author is on solid ground with their assessment.  Does Foot Locker have the ability to break the chains that have shackled their performances over the past couple of years?  Is the combination to the lock the right one to free the retailer to be successful once again?  Let's take a look.

Under Armour Under Fire

January 21, 2008

Analysis of:Under Armour Shares Fall After Downgrade | money.cnn.com

How real are the issues that currently face Under Armour? The stock fell 24% on Friday as part of a perfect storm fueled by recession concerns, negative retail reports for the Holiday period, and a UA forecast termed disappointing by stock analysts, all converging at the same time. What impact will the upcoming UA Super Bowl advertisement and release of the cross training footwear line have on the brand in 2008? Can the brand achieve their projected long term growth rate of 20-25%? These are some of the key issues which help to answer the ultimate question: can Under Armour protect their house.

Two Peas in an iPod

September 5, 2006

Analysis of:It lets runner keep the beat and track the feet | www.washingtonpost.com

The merger of two giants in their respective industries creates a multitude of opportunities for both brands. Some are obvious, while others are a little more obscure.

Apple and Nike have come from different paths to reach the same point. A combination of the two would have seemed to be unlikely at best 10 years ago. The sharing of products in 2006 now appears to be a very smart move for different reasons, depending on which company is given focus.

Nike is in a war right now at retail. Many factors have contributed to the difficulties in the market place. More importantly, only a few actions taken on Nike's part can help keep the brand above the currently fraying athletic footwear market. With the consumer seemingly bored with the more recent technologies introduced in the industry, a turn to the real hotbed of technology provides much needed energy to the brand.

Apple is a company which has once again risen to become the most talked about brand in the computer industry. This time, they have also transcended the world of computers to stand on the same podium with what many consumers over the past 20 years have considered to be the coolest and hippest brand of their generation.

Apple can now dig even deeper into the minds and pockets of the trendy 12-24 year old consumer with its expertise in product development and marketing. Along the way, they are also able to tap into a technology receptive group which hits the road to exercise and relieve the stresses of every day life.

When you add up the two, not even a computer can argue with the logic that 1 plus 1 equals 3.

The Yen and Yang of Retail

August 21, 2006

Analysis of:3 ominous signs for retail...maybe | money.cnn.com

This article gives a perspective from both sides of the coin. This is an unusual approach in that the writer does not lead the reader to a conclusion.

On the side of tails, the doom and gloom that follows with negative news from three major retailers is given plenty of attention in the article. This side leads us to believe that the disappointing numbers released by the Gap, Home Depot, and Walmart mean that Armageddon is upon us and dark days lie ahead in retail.

The side of heads is presented with a much more positive approach. Analysts speculate that the respective retail train wrecks are not a sign of a dampening economy as much as they are a sign of individual issues which have existed within these companies.

Where does the truth lie? As always, the truth lies somewhere in the middle of the bears and the bulls. Do the signs point to a retail train wreck between now and the Holiday season? Let’s take a look.

Under Armour Apparel = Footwear? = Nike?

August 14, 2006

Analysis of:Under Armor footwear joins Nike, Reebok at NFL | www.boston.com

The agreement announced with the NFL is a move to put the brand more in direct competition with major brands of the industry. This means it is a road game for UA as it now takes the team to the home fields of Nike, Adidas, and Reebok.

1) The Baltimore based company is one of the few shining lights right now in a dim athletic retail environment. They are moving forward in the footwear game with its recent agreement with the NFL to gain on field exposure. The NFL players will be able to display the logo of UA on their cleats on the field to put the brand on par with Nike and Reebok. Any brands worn by football players on the field outside of Nike, Reebok, and now UA, must have the logos taped over, or “spatted”, as is the term used in footwear. UA plans to employ this strategy to the utmost, with Kevin Plank, CEO and founder of UA, predicting that they will have 20% market share in football cleats this first season.

2) Success breeds success. UA will take this initial foray into the world of football and duplicate it to other sports. The formula has been proven to work most of the time in the top competitive athletic activities which are a core part of the young consumer’s interest.

3) Management is making the right moves early in the high risk/high reward field of athlete and team promotions. They have successfully guided the brand from a basement operation to a powerful apparel brand in the emotionally charged and competitive field of individual and team sports.

BTS---Internet and Internot

August 10, 2006

Analysis of:Back-to-School Shopping Heads Online | www.emarketer.com

The Back To School season is upon us. The retail climate is grinding right now, especially in the mall sector, where the 90’s saw a flourish of business as young consumers flocked to shop or just hang out with friends.  This is no longer the 90's.

The internet is now a part of our daily activities, and two separarte surveys suggest quite a variance in the range of the BTS business to be done on-line from 15% to over 50%. 

Another point of relevance about the BTS business comes from NPD Group via a survey of 34,000 shoppers. The time period in which the back to school business will be accomplished this year will be shorter, as 40% of the respondents suggested that they will start their BTS shopping before August 1, versus 43% in 2005. They will not spend less, but rather just have less time in which to spend their money.

The categories most impacted are no surprise when it comes to BTS purchases: apparel, electronics, footwear, and school supplies. The preferred BTS retailer channels of distribution listed in the article (discount stores, followed by department stores, office supplies, specialty stores, and drug stores) provide insight into which areas should be more affected by the on-line shopping surge.

Wherever the true percetage of on-line business winds up for BTS, the article misses the most important point of all: 

The internet business is on the rise, and that means the mall based brick and mortar operations will have one more obstacle placed in their way in an already difficult environment.

This is where I would like to focus my thoughts.

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