Market Update:
- China’s gross domestic product grew by 7.4% in the first quarter, which was the slowest rate in 18 months. However, this was more than the the forecast rate of 7.3% and was successful in calming the nerves of investors.
- The fed released “Beige Book” report, which is a read on the U.S economy from anecdotes gathered by the central bank’s 12 districts. According to the report, the economy of the entire country bounced back after the growth was hampered by the unusually cold winter.
- Stock prices went up for Down Jones .
- Twitter, on the other hand, has been under performing . The reasons being slowing user growth, declining user engagement and premium valuation. There is some potential for its user growth and user engagement to increase in near future, and ad engagement remain healthy as well. The stock rallied at 11% on Tuesday, which is the highest since the day it went public.
- Alibaba, which is a Chinese e-commerce behemoth , produces more sales and net income than ebay and amazon combined. It can raise up to $15 billion at the valuation of up to $200 billions.
- Weibo, which is like twitter, is set to begin trading on Thursday in NASDAQ and JD.com, which is Alibaba’s rival filed for $1.5 billion listing in January.
Stock Pitch:
Under Armour
Under Armour is a leading developer, marketer and contributor of sports apparel and now is venturing into foot wear and women’s wear. Its main markets are North America, Eurpe, Middle East, Africa, Asia and Latin America.
- Trailing P/E: 67.92
- Forward P/E 43.35
- Return on Equity:17.36% relative to cost of capital :9-10%
- Debt:152.92 relative to cash earnings:347.49
- Current ration:2.65x
- Quarterly Earnings Growth-163.4%
Why?
1) There is potential of future growth.
- International Expansion
- Expanding into new apparels: women’s wear and youth wear.
2) It is venturing into new innovative products as well.
- MagZip: Zipper which uses magnet to attract bottom rungs of the zipper (http://gearjunkie.com/)
- Workout Monitor
- Heart rate strap
It is also venturing into NBA market, which is a huge news in itself.
The last time we bought it before the Christmas season to capture the consumer spending right in the holiday season. We were able to do that and earned few gains.
Elections:
Owl Investment Group had elections for new executive board. The new executive board for 2014/2015 is:
- President: Dingwei Li
- Portfolio Manager: Yaxuan Wen
- Bank Treasurer: Yannan (Nancy) Li
- Publicist: Tianyi (Claire) He
- Secretary: Yiling Bai
Congratulation to the new e-board. We hope you have a wonderful time and continue the great legacy of OIG.