Financial Analysis: Under Armour (NYSE:UAA) versus Innovative Designs (OTCMKTS:IVDN)

Under Armour (NYSE:UAA) and Innovative Designs (OTCMKTS:IVDN) are both consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, institutional ownership, risk, valuation, analyst recommendations, dividends and earnings.

Insider and Institutional Ownership

34.6% of Under Armour shares are owned by institutional investors. 15.6% of Under Armour shares are owned by insiders. Comparatively, 24.4% of Innovative Designs shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Under Armour and Innovative Designs”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Under Armour	$4.97 billion	0.47	-$495.64 million	($1.16)	-4.70
Innovative Designs	$2.77 million	4.53	$500,000.00	$0.03	10.86

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

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Under Armour and Innovative Designs, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Under Armour	4	14	1	1	1.95
Innovative Designs	0	0	0	0	0.00

Under Armour currently has a consensus price target of $5.91, suggesting a potential upside of 8.35%. Given Under Armour’s stronger consensus rating and higher probable upside, analysts clearly believe Under Armour is more favorable than Innovative Designs.

Profitability

This table compares Under Armour and Innovative Designs’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Under Armour	-9.98%	3.01%	1.05%
Innovative Designs	21.73%	31.18%	28.17%

Volatility and Risk

Under Armour has a beta of 1.69, indicating that its stock price is 69% more volatile than the S&P 500. Comparatively, Innovative Designs has a beta of -2.83, indicating that its stock price is 383% less volatile than the S&P 500.

Summary

Innovative Designs beats Under Armour on 8 of the 15 factors compared between the two stocks.

About Under Armour

Under Armour, Inc., together with its subsidiaries, engages developing, marketing, and distributing performance apparel, footwear, and accessories for men, women, and youth. The company provides its apparel in compression, fitted, and loose fit types. It also offers footwear products for running, training, basketball, cleated sports, recovery, and outdoor applications. In addition, the company provides accessories, which include gloves, bags, headwear, and socks; and engages in brand licensing, digital subscription, advertising, and other digital business activities. It primarily offers its products under the UNDER ARMOUR, ARMOUR, HEATGEAR, COLDGEAR, HOVR, UA, PROTECT THIS HOUSE, I WILL, ARMOUR FLEECE, and ARMOUR BRA brands. The company sells its products through wholesale channels, including national and regional sporting goods chains, independent and specialty retailers, department store chains, mono-branded Under Armour retail stores, institutional athletic departments, and leagues and teams, as well as independent distributors; and directly to consumers through Brand and Factory House stores, as well as through e-commerce websites. It operates in the United States, Canada, Europe, the Middle East, Africa, the Asia-Pacific, and Latin America. The company was incorporated in 1996 and is headquartered in Baltimore, Maryland.

About Innovative Designs

Innovative Designs, Inc. engages in manufacture and marketing of cold weather recreational and industrial clothing products in the United States and Canada. The company operates in two segments, Apparel and House Wrap. It offers arctic armor line products, including jackets, bibs, and gloves for ice fisherman, snowmobilers, utility workers, oil/gas pipeline workers, railroad workers, construction workers, ski resort workers, and police and first responders; and house wrap that provides barrier protection and moisture vapor transmission and insulation for the building construction industry. In addition, it offers INSULTEX material in bulk to non-competing customers; products that restore the waterproof character of the outer side of its arctic armor clothing; and cold weather headgears and base insulation clothing products. The company primarily sells its products through independent sales agents, agencies, retailers, and distributors, as well as through website. The company was incorporated in 2002 and is based in Pittsburgh, Pennsylvania.