Tuesday, April 12, 2016

Stock Dividend: Under Armour (UA, UA.C)

Under Armour Stock Dividend 

On April 8th, UA reorganized its ownership structure and gave a stock dividend 1:1 in which the shareholders receive once share of UA Class C shares (non voting) for each UA share held.  This explains the "50% drop" in the stock price (but not really).  It essentially has the same effect as a 2:1 stock split, but I do hate seeing two lines of UA now.  Almost a year later, investors are finally seeing their 'stock split' and maybe forgot it was supposed to.  It was in effect so that the CEO Kevin Plank could keep 15% of the company he founded, and allow the company to pay compensation with the non-voting shares.

It is exciting to write a little bit about my first stock dividend while contributing to this blog.  Hope others join this list soon as well!  Although it has no impact on the value of the company or my holdings, for me it just feels good to see the number of shares grow!

Hopefully, Steph Curry and the Warriors can help drive this stock a little after Jordan's epic collapse. Should really have no impact on the view of the company, but we know it will move it in the short term.

Oh did I mention that they have 5 players that were the respective "MVPs" in their sport.  Incredible story!

If you want to find additional information on this stock split please go to the Under Armour Release.

Full Disclosure: Long UA

Are you invested in UA?  Most likely not.  Regardless, if you understand, can you please explain to me the tax basis of my new UA.C shares?  I am not exactly sure how it works as it is a new class of stock and my broker is showing $0 as the cost basis.  Typically, if it was the same class of stock each shares basis would become 1/2 in the case of a 2:1 split. I noticed owners mentioned selling their UA.C and plan to buy UA.  May have to follow suit as I hate seeing two symbols for the same company.  Any thoughts?

I'm not an investment professional or a licensed financial advisor. This blog represents my personal views and decisions, which may not be appropriate for other investors. Please use common sense or consult with an investment professional before investing your money. I am not responsible for the outcomes of your decisions, nor am I responsible for the comments posted by readers or the contents of any linked websites. This blog should viewed for educational or entertainment purposes only.

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