SBD/July 31, 2013/Finance

CNBC's Jim Cramer Tackles Whether Nike Or Under Armour Is The Better Stock Buy

Cramer puts Nike and Under Armour through one of his performance tests
If you "simply evaluated" Nike and Under Armour based on the recent quarterly results and future growth opportunity, the conclusion of which is currently a better stock buy "is a very easy answer: It's Under Armour," according to CNBC's Jim Cramer. UA reported "incredible results" as gross margin "increased by 250 basis points from the year before and a huge raise for your guidance." While Nike last month "delivered better than expected numbers, the upside surprises were modest" compared to UA's results. UA's "venture into footwear -- Nike's home turf -- has been extremely successful" and the company's new football cleat "has been the No. 1 seller in its category." Meanwhile, Nike has "always been driven by innovation," but the company recently said that it needed "to 'accelerate our innovation agenda.'" Cramer said, "Translation: These guys realize the competitors, like Under Armour, are upping the ante on innovation right now. Nike needs to double-down in order to maintain their fantastic global position." Cramer added, "If you're an older investor and you don't want to worry about the risk of a big miss, I would still recommend buying Nike over Under Armour even after Under Armour's stellar quarter. But if you're a younger investor with all the time in the world to make back any losses if Under Armour momentarily stumbles, then UA is the stock for you. ... Both companies represent the best kinds of stocks we have in this market" ("Mad Money," CNBC, 7/30).
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Finance, Nike, Under Armour

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