Leading designer, marketer, and distributor of authentic athletic footwear, apparel, and accessories, Under Armour, Inc. UA announced that its Chief Financial Officer (CFO) and Chief Operating Officer (COO), Brad Dickerson will resign in early 2016.
Following the reports, the company’s shares not only declined 2% during yesterday’s trading session but also fell another 1.3% during after-hours trading. Zacks Investment Research downgraded the company by a notch to a Zacks Rank #4 (Sell) on the news.
Dickerson, who has been working with Under Armour since 2004, assumed the position of CFO in 2008 while he took over the COO position in 2015. He will continue working with the company till February 2016.
Under Armour’s CEO and founder Kevin Plank said,, “During his time at Under Armour, Brad has played an integral role in providing value for the company by building a strong team and demonstrating a core competency of accelerating growth, taking the company from pre-IPO to a multibillion-dollar global business.”
Under the strong leadership of Dickerson, the company has done exceptionally well and its shares have gained more than 950% in the past 10 years. The Baltimore-based company is now targeting net revenue of $7.5 billion by 2018, indicating compounded yearly growth rate of 25% from the company’s 2014 net revenues of $3.1 billion.
The company is also aiming to increase its operating income to $800 million by 2018 from the 2014 figure of $354 million, demonstrating a 23% compounded annual growth. These figures include contribution from Connected Fitness, which Under Armour acquired in 2015. To achieve its long-term growth the company will increase its spending by 8% to 10% of net revenue per annum.
Stocks to Consider
Some better-ranked stocks in this sector include Guess' Inc. GES, Columbia Sportswear Company COLM and Perry Ellis International Inc. PERY. All these stocks sport a Zacks Rank #1 (Strong Buy).
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