After making the critical mistake of praising Trump publicly as a “pro-business president” and a “real asset for the country”, the CEO of Under Armour, and his shareholders for that matter, can’t seem to catch a break. It all started last week when Under Armour CEO Kevin Plank visited with CNBC and made the mistake of saying the following:
“To have such a pro-business president is something that is a real asset for the country. People can really grab that opportunity. He wants to build things. He wants to make bold decisions and be really decisive.”
After reporting abysmal quarterly earnings late in January, Plank’s pro-Trump comments pushed the stock to fresh multi-year lows on February 7th.
Of course, it didn’t take long for Under Armour’s signed athletes to blast Plank’s comments with Steph Curry saying that his statement was true “if you remove the ‘et’ from asset.” Meanwhile, Dwayne ‘The Rock’ Johnson and Misty Copeland also spoke out against Plank’s misguided praise.
Now, Susquehanna’s equity analyst covering Under Armour, Sam Poser, has decided to downgrade the stock in light of the CEO’s positive Trump one-liner, saying that now it’s “nearly impossible to effectively build a cool urban lifestyle brand in the foreseeable future.” Per Bloomberg:
“At this point we don’t believe Under Armour is in danger of losing Steph Curry,” Poser said. “However, it simply cannot be good for business if the face of Under Armour spoke out so pointedly against the CEO’s comments. Other Under Armour brand athletes such as Dwayne ‘The Rock’ Johnson and Misty Copeland have also spoken out against Mr. Plank’s comments.”
Meanwhile, Poser also slashed his price target on Under Armour from $24 per share to $14, implying that the cost of praising Trump is roughly $4.5 billion.
Finally, as if the situation weren’t bizarre enough already, Plank was forced to take out a full-page ad in the Baltimore Sun today walking back his previous praise of Trump. Per The Hill:
“In a business television interview last week, I answered a question with a choice of words that did not accurately reflect my intent,” the ad, addressed to Baltimore, reads. “I want to clarify to our hometown exactly the values for which Under Armour and I stand.”
While the letter never directly mentions Trump, it says the company stands for equal rights, praises immigration as a “source of strength, diversity and innovation,” and comes out against Trump’s executive order on immigration and refugees.
“I personally believe that immigration is the foundation of our country’s exceptionalism,” Plank wrote.
Under Armour CEO Kevin Plank prints full-page ad in today’s Baltimore Sun to clarify POTUS comments; doesn’t mention Trump by name http://pic.twitter.com/TWk40PydRg
— Sara Germano (@germanotes) February 15, 2017
We sincerely look forward to waking up from this bizarre dream soon…
via http://ift.tt/2kyDk8n Tyler Durden