Centric Brands (CTRC) versus Under Armour (UAA) Critical Analysis

Under Armour (NYSE:UAA) and Centric Brands (NASDAQ:CTRC) are both consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Institutional and Insider Ownership

37.6% of Under Armour shares are held by institutional investors. Comparatively, 2.7% of Centric Brands shares are held by institutional investors. 16.4% of Under Armour shares are held by insiders. Comparatively, 28.6% of Centric Brands shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

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

Net Margins Return on Equity Return on Assets
Under Armour -2.68% 3.96% 1.89%
Centric Brands -10.15% -22.07% -6.15%

Risk and Volatility

Under Armour has a beta of 0.06, meaning that its share price is 94% less volatile than the S&P 500. Comparatively, Centric Brands has a beta of -1.13, meaning that its share price is 213% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for Under Armour and Centric Brands, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Under Armour 6 13 3 0 1.86
Centric Brands 0 0 0 0 N/A

Under Armour currently has a consensus price target of $21.83, indicating a potential upside of 10.96%. Given Under Armour’s higher probable upside, research analysts plainly believe Under Armour is more favorable than Centric Brands.

Earnings and Valuation

This table compares Under Armour and Centric Brands’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Under Armour $4.98 billion 1.77 -$48.26 million $0.19 103.53
Centric Brands $164.05 million 1.12 -$2.45 million ($0.94) -3.36

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

Summary

Under Armour beats Centric Brands on 11 of the 13 factors compared between the two stocks.

About Under Armour

Under Armour, Inc., together with its subsidiaries, develops, markets, and distributes branded performance apparel, footwear, and accessories for men, women, and youth primarily in North America, Europe, the Middle East, Africa, the Asia-Pacific, and Latin America. The company offers its apparel in compression, fitted, and loose types to be worn in hot, cold, and in between the extremes. It also provides various footwear products, including running, basketball, cleated, slides and performance training, and outdoor footwear. In addition, the company offers accessories, which include headwear, bags, and gloves; and digital fitness subscriptions, as well as digital advertising through MapMyFitness, MyFitnessPal, and Endomondo applications. It primarily offers its products under the UA Logo, UNDER ARMOUR, UA, ARMOUR, HEATGEAR, COLDGEAR, ALLSEASONGEAR, PROTECT THIS HOUSE, and I WILL, as well as ARMOURBITE, ARMOURSTORM, ARMOUR FLEECE, ARMOUR BRA, and UNDER ARMOUR CONNECTED FITNESS brands. The company sells its products through wholesale channels, including national and regional sporting goods chains, independent and specialty retailers, department store chains, institutional athletic departments, and leagues and teams, as well as independent distributors; and directly to consumers through a network of brand and factory house stores, and Website. Under Armour, Inc. was founded in 1996 and is headquartered in Baltimore, Maryland.

About Centric Brands

Centric Brands Inc. engages in the design, development, sale, and licensing of apparel products and accessories under the Robert Graham brand name worldwide. The company operates through Wholesale and Consumer Direct segments. Its product line includes men's sport shirts, knits, sweaters, polos, T-shirts, denim jeans, bottoms, shorts, sport coats, outerwear, and swimwear; shoes, belts, small leather goods, dress shirts, neckwear, tailored clothing, headwear, eye and sun glasses, jewelry, hosiery, underwear, loungewear, and fragrances for men that are produced through third parties under various license agreements; and women's apparel. The company also offers denim jeans, bottoms, tops, jackets, and other related apparel and accessories for women, men, and children under the Hudson brand name; and footwear and apparel products and accessories under the SWIMS brand name, as well as licenses Hudson children's products. It sells its products through 30 Robert Graham brand full-price retail stores and outlet stores; Robert Graham catalogs; and 2 SWIMS brand outlet stores, as well as online through hudsonjeans.com, robertgraham.us, and swims.com Websites. The company was formerly known as Differential Brands Group Inc. and changed its name to Centric Brands Inc. in October 2018. Centric Brands Inc. was founded in 1987 and is based in New York, New York.

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