Retail Roundup: Under Armour Sticks Fork in Analysts' Bearishness

Stocks have been all over the map Thursday as investors still try to sort of which direction to go following the Fed's most recent statement on Wednesday. But that hasn't stopped shares of Under Armour (UA) from soaring on the day, up a hefty 23%. Schnikes, that's a lot. (Or is that competitively offensive, due to the verbal similarity to Nike (NKE)?)

Let's stick to Under Armour. The stock continues to trend higher after the company beat on earnings per share and revenue expectations, the latter of which grew a whopping 30.7% year over year. The results are doing more than sending the stock higher; they're vindicating long-term investors and management by completely turning some analysts' assessments on their head. 

Most notably, analysts at Morgan Stanley downgraded the stock to underweight a few weeks ago, moving their price target down to $62 from $103. Analysts cited weak average selling prices and a loss of market share as its reasoning. 

On the conference call, CEO Kevin Plank -- a man TheStreet's Jim Cramer said should never be bet against -- called the company an "all-weather business," silencing those who doubted Under Armour's ability to sell its merchandise due to unseasonably warm weather that kicked off the fourth quarter. 

For some reason, his commercial is how I picture Kevin Plank's business philosophy: 

Apparently you don't need to go online in order to hit up Etsy (ETSY) anymore. The company is reportedly looking to take a step out of the digital universal, and into the physical world of commerce. 

The company has worked out an agreement with Macy's (M) to have the Etsy Shop open in Macy's flagship store in New York City. The best part for shoppers? They can buy what they like and take home with them rather than shopping around, finding something they like and then being forced to order it online.

The company has worked out similar agreements in the past, notably with Nordstrom (JWN) and Williams-Sonoma's (WSM) West Elm.

Macy's appears to be running the experiment with Etsy to get a better feel for shoppers, especially younger ones. If it's something that pans out, perhaps it will have national implications. 

An experiment to find future growth shouldn't surprise investors, as most traditional bricks-and-mortar retailers like Macy's have seen a tough selling environment as online retailers - most notably, Amazon (AMZN) , which reports earnings Thursday night - take a serious chunk out of the retail pie. 

Uber vs. Amazon

So if Macy's is trying to recruit online sellers into traditional stores to combat the invasive retail species known as Amazon, what are others doing? It's hard to compete with an online juggernaut that can undercut almost everyone on price, deliver to customers' home in neck-break speed, and create such a seamless shopping experience all at once.

But you've got to try, right?

How about turning to the mega-unicorn known as Uber and its shipping platform UberRush. Launched in October to cater to consumers in locations like New York, Chicago and San Francisco, the company is now expanding its service by adding more companies to the list.

Due to the platform's design, customers may not even notice the difference - other than the timeliness. Customers will simply shop online as they normal do, at locations such as Nordstrom, T-Mobile (TMUS) and 1800Flowers (FLWS) , and the merchant will be the one coordinating the delivery efforts with UberRush, paying $5 to $7 per order.

Buying things online has always been convenient, but with Amazon expanding its vast offerings and allowing for rapid shipping times, consumers are starting to hit a tipping point with the "I need it in my hands now so I'll buy it from a store" versus "I'll order online and have it tomorrow." 

But relax. Retailers aren't trying to stop you from having this internal back-and-forth debate about whether to buy online or at the shop around the corner. No, they're just looking to get in on the action, and they're looking to do so by teaming up with the companies of tomorrow.

 

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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