Cotton is Not the Enemy?

By Andrea K. Walker

The Baltimore Sun

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Under Armour may launch a new line of hybrid-cotton apparel next year, according to an analyst that follows the company.

The Baltimore sports apparel company is known mostly for its slick feeling, fitted compression wear.

Analyst Michael Binetti, who follows Under Armour for UBS Securities LLC, in a research report released Monday described the new line of apparel as “coated cotton that wicks moisture from the skin, but still has its cotton feel.”

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Binetti revealed the company’s plans for the new line in a research note where he also announced he was upgrading the company’s stock to a buy rating.

A spokeswoman for Under Armour would not confirm plans for a launch.

“We are always challenging ourselves to provide athletes with the apparel they want – and need – for every training and game-day situation,” the spokeswoman, Diane Pelkey, said in an emailed response. “As such, we rigorously test multiple fabrics to determine the optimal combination of comfort and performance. Performance is the key and we are always looking for new fabrications to offer to our athletes to give them the edge.”

Binetti said in his note that a cotton line could offset worries about the potential success of the company’s shoe line. The company is in the process of revamping its shoe line, which hasn’t been performing as well as expected. Many analysts aren’t convinced footwear will be an earnings driver in the near-term.

Cotton athletic wear is a $12 billion market, compared to a $5 billion market for running shoes and a $3 billion market for basketball shoes.
 

(This story can be found in its original format here.)

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