Cramer has never been afraid to tell someone that they’re wrong. In fact, today on “Squawk on the Street” he told a New Jersey realtor group that its outlook on housing was completely off the mark. So it’s no surprise that when UBS yesterday downgraded Mad Money favorite Under Armour Cramer was characteristically honest.
Basically, UBS downgraded Under Armour to a “sell” because of slowing sales due to warmer-than-usual weather. The analyst cut earnings estimates on UA by almost 10% and dropped his price target from $72 to $68.
So what was Cramer’s problem with this reasoning? It may be warm now, but sooner rather than later the seasons will change and Under Armour apparel should fly off the shelves. To sink the stock with such depthless analysis was “just plain wrong,” Cramer said.
UBS also ignored the confidence with which CEO Kevin Plank spoke of Under Armour’s opportunities worldwide in a variety of markets, including men’s and women’s apparel, cleats and training shoes. The man never showed a single sign that business had slowed, Cramer said.
Cramer has banked with Plank since Under Armour’s inception, he said, and he’s not about to stop now.
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