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Under Armour Inc. (UA - Analyst Report), a leading designer, marketer, and distributor of athletic footwear, apparel and accessories for a wide variety of sports and fitness activities, recently announced a stock split program for the first time since it started trading in November 2005.

The intention to split its common stock has been approved by the company’s board of directors. Under the program, shareholders owning one share of UA at the close of business on June 25, 2012, will receive two shares of UA common stock on July 9, 2012.

The company said the stock split will be made in the form of a dividend of one share of Class A common stock for each existing share outstanding and similarly for Class B shares.

Management believes that the stock split will expand the company’s shareholder base, increase market liquidity and enhance shareholder value. Management remains upbeat about its strategy of returning value to its shareholders in the long term.

Under Armour ended the first quarter of 2012 with cash and cash equivalents of $107.1 million, total long-term debt of $75.8 million and shareholders’ equity of $674.1 million. The company had no borrowings under its revolving credit facility of $300 million at the end of the quarter and incurred $8.8 million in capital expenditure.

We believe that Under Armour has a sturdy balance sheet with an excellent management team carving out the long-term growth opportunities across all its categories. Under Armour is a well established brand that we expect will continue to benefit from shifting trends toward performance-based products within the industry over the long term.

The company, which competes with Nike Inc. (NKE - Analyst Report) and Columbia Sportswear Company (COLM - Snapshot Report), offers a wide variety of products including sporting goods and lifestyle products and engages in the design, development, marketing and distribution of a range of apparel and accessories utilizing various synthetic microfiber fabrications in the United States and internationally.

The quantitative Zacks #3 Rank (short-term Hold rating) for the company’s shares indicates that the shares will trade in line with the peer group over the next 1-3 months.

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