Summary and Opinion: Based on our observation of a disclosure subtlety, which we speak to in this report, we believe there is only one conclusion to take-away from it: The Under Armour data breach is so bad, and such a material threat to the company itself, we say it has management rattled. Investors should be too.
After the close last Thursday, and right after investors had left for a three-day weekend, Under Armour dropped a bomb with the announcement of a sizable data breach. While news of this nature surely surprised most who follow the company, and timing of the disclosure is indicative of a sleazy disclosure practice, we expect the usual suspects will line up to defend or criticize the company.
In the midst of the pontificating, we also expect a simple, but important piece of the analysis will be overlooked. It’s a disclosure subtlety we expect few will have given much thought to, perhaps because it is in plain sight.
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