Head-To-Head Survey: Under Armour (NYSE:UA) and Adidas (OTCMKTS:ADDYY)

Adidas (OTCMKTS:ADDYY) and Under Armour (NYSE:UA) are both consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, profitability, valuation, risk, analyst recommendations and institutional ownership.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Adidas	6.08%	26.00%	7.92%
Under Armour	-9.80%	3.12%	1.05%

Valuation & Earnings

This table compares Adidas and Under Armour”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Adidas	$28.06 billion	1.25	$1.52 billion	$5.38	18.21
Under Armour	$4.97 billion	0.41	-$495.64 million	($1.11)	-4.25

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.

Volatility and Risk

Adidas has a beta of 1.23, indicating that its stock price is 23% more volatile than the S&P 500. Comparatively, Under Armour has a beta of 1.51, indicating that its stock price is 51% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Adidas and Under Armour, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Adidas	2	3	10	1	2.62
Under Armour	2	1	0	0	1.33

Adidas currently has a consensus price target of $146.00, indicating a potential upside of 49.03%. Under Armour has a consensus price target of $5.50, indicating a potential upside of 16.65%. Given Adidas’ stronger consensus rating and higher possible upside, research analysts plainly believe Adidas is more favorable than Under Armour.

Insider & Institutional Ownership

36.3% of Under Armour shares are held by institutional investors. 15.6% of Under Armour shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Adidas beats Under Armour on 12 of the 15 factors compared between the two stocks.

About Adidas

Adidas AG is a German sporting goods company that designs, develops and markets athletic footwear, apparel and accessories. Its products serve both performance-focused athletes and consumers seeking sports-inspired lifestyle products. Founded in 1949 by Adolf Dassler, the company is headquartered in Herzogenaurach, Germany. Adidas sells its products around the world through wholesale partners and its own retail stores and digital channels. The company is led by CEO Bjørn Gulden. Its offerings span categories including running, football, training and other sports, alongside lifestyle footwear and apparel.

About Under Armour

Under Armour, Inc. develops, markets and distributes performance apparel, footwear and accessories for athletes and consumers. Its products include training and running apparel, athletic shoes, sports bras and accessories such as bags and headwear. Founded in 1996 by Kevin Plank, the company is headquartered in Baltimore, Maryland. Under Armour sells its products internationally through wholesale partners, company-operated stores and e-commerce channels.