Under Armour Inc. Just Nipped This Controversy in the Bud

Under Armour just extended its U.S. speedskating sponsorship deal through 2022. Here's what fans and investors need to know.

Feb 21, 2014 at 2:30PM

In athletics, there's arguably no better way to test character and competitive spirit than to see how someone reacts in the face of adversity.

And if Under Armour (NYSE:UA) were an athlete, I think it's safe to say it would have passed that test with flying colors today.

Shares of Under Armour have risen more than 4% so far today after the company announced an extension of its U.S. speedskating sponsorship for another two Olympics through 2022.

The announcement came as the U.S. long-track speedskating team failed to win an Olympic medal for the first time since 1984 after the men's and women's teams made their shutouts official this morning by losing their respective quarterfinal team-pursuit events. Tomorrow, the U.S. men will take on France for seventh place, while the women will race Canada for fifth. 

Unfortunately for Under Armour, this also happens to be the the team's first Winter Olympics donning the highly technical speed suits made by the performance-apparel specialist, which has sponsored them since Nike's contract expired in 2011. Unsurprisingly, Under Armour came under fire last week when some of the skaters reportedly claimed they were battling the suit to maintain proper form.

But the skaters failed to improve their results even after switching back to an older Under Armour suit, in which they previously enjoyed considerable success at the World Cup. 

Under

Under Armour CEO Kevin Plank. Source: Under Armour.

Everybody loves an underdog
Commenting on the curious timing of the extension in a CNBC interview, Under Armour CEO Kevin Plank replied:

We didn't want the story going any longer. ... We want to make sure that our message is there -- that this isn't just a one and done. I think there was some speculation on how we were going to react to it, and I want people to be clear that we will stand up and we will come back. And there's nothing more American than that story. 

Going even further, when asked if he felt vindicated when the old suits didn't result in better performance, Plank insisted, "No. We're patriots first. ... If you ever found yourself rooting against an athlete, you're in the wrong business."

Now I'll admit I've always liked Kevin Plank, but this is delightfully impressive.

In short -- and even after some athletes wrongfully blamed the suit -- not only did Under Armour not run for the hills, but instead it sprinted directly at the problem to pledge its support for the athletes over the long term.

Then again, perhaps this is simply perfect execution of crisis management 101, but it's also exactly the kind of attitude both investors and sponsored athletes want to see. If one thing's for sure in the end, Under Armour just proved beyond a shadow of a doubt it's here to stay.

Speaking of massive long-term potential...
I plan on holding my shares of Under Armour for decades, but that doesn't mean it's the only promising stock out there. So where else can you invest?

Let's face it, every investor wants to get in on revolutionary ideas before they hit it big. Like buying PC-maker Dell in the late 1980's, before the consumer computing boom. Or purchasing stock in e-commerce pioneer Amazon.com in late 1990's, when they were nothing more than an upstart online bookstore. The problem is, most investors don't understand the key to investing in hyper-growth markets. The real trick is to find a small-cap "pure-play", and then watch as it grows in EXPLOSIVE lock-step with it's industry. Our expert team of equity analysts has identified 1 stock that's poised to produce rocket-ship returns with the next $14.4 TRILLION industry. Click here to get the full story in this eye-opening report.

Steve Symington owns shares of Under Armour. The Motley Fool recommends and owns shares of Nike and Under Armour. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers