Head-To-Head Comparison: Adidas (OTCMKTS:ADDYY) & Under Armour (NYSE:UAA)

Under Armour (NYSE:UAA – Get Free Report) and Adidas (OTCMKTS:ADDYY – Get Free Report) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitability, dividends, risk and institutional ownership.

Earnings & Valuation

This table compares Under Armour and Adidas”s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Under Armour $4.97 billion 0.41 -$495.64 million ($1.15) -4.09
Adidas $28.06 billion 1.02 $1.52 billion $4.54 17.61

Adidas has higher revenue and earnings than Under Armour. Under Armour is trading at a lower price-to-earnings ratio than Adidas, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Under Armour has a beta of 1.62, indicating that its share price is 62% more volatile than the S&P 500. Comparatively, Adidas has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Under Armour and Adidas, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Under Armour 4 10 1 1 1.94
Adidas 1 4 10 1 2.69

Under Armour currently has a consensus price target of $5.77, suggesting a potential upside of 22.65%. Adidas has a consensus price target of $146.00, suggesting a potential upside of 82.59%. Given Adidas’ stronger consensus rating and higher probable upside, analysts plainly believe Adidas is more favorable than Under Armour.

Institutional and Insider Ownership

34.6% of Under Armour shares are owned by institutional investors. 15.7% of Under Armour shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Under Armour and Adidas’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Under Armour -9.99% 4.04% 1.37%
Adidas 5.30% 22.35% 6.80%

Summary

Adidas beats Under Armour on 11 of the 14 factors compared between the two stocks.

About Under Armour

(Get Free Report)

Under Armour, Inc., together with its subsidiaries, engages developing, marketing, and distributing performance apparel, footwear, and accessories for men, women, and youth. The company provides its apparel in compression, fitted, and loose fit types. It also offers footwear products for running, training, basketball, cleated sports, recovery, and outdoor applications. In addition, the company provides accessories, which include gloves, bags, headwear, and socks; and engages in brand licensing, digital subscription, advertising, and other digital business activities. It primarily offers its products under the UNDER ARMOUR, ARMOUR, HEATGEAR, COLDGEAR, HOVR, UA, PROTECT THIS HOUSE, I WILL, ARMOUR FLEECE, and ARMOUR BRA brands. The company sells its products through wholesale channels, including national and regional sporting goods chains, independent and specialty retailers, department store chains, mono-branded Under Armour retail stores, institutional athletic departments, and leagues and teams, as well as independent distributors; and directly to consumers through Brand and Factory House stores, as well as through e-commerce websites. It operates in the United States, Canada, Europe, the Middle East, Africa, the Asia-Pacific, and Latin America. The company was incorporated in 1996 and is headquartered in Baltimore, Maryland.

About Adidas

(Get Free Report)

adidas AG, together with its subsidiaries, designs, develops, produces, and markets athletic and sports lifestyle products in Europe, the Middle East, Africa, North America, Greater China, the Asia-Pacific, and Latin America. It offers footwear, apparel, and accessories and gear, such as bags and balls under the adidas brand; golf footwear and apparel under the adidas Golf brand; and outdoor footwear under the Five Ten brand. It sells its products through its own retail stores; mono-branded franchise stores and shop-in-shops; and wholesale and its e-commerce channels. The company was formerly known as adidas-Salomon AG and changed its name to adidas AG in June 2006. adidas AG was founded in 1920 and is headquartered in Herzogenaurach, Germany.

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