underarmour.com

Under Armour (NYSE:UA) may be the best investment I’ve never made.

Over the last five years Under Armour stock price is up 547%. In the last year that has slowed to almost 24%, but that’s still very impressive.

Source: Under Armour stock price data by amigobulls.com

Recently, though, the performance of the stock has sputtered a bit. It fell hard in the middle of November, recovered, but has fallen back again. Even at the Monday opening price of $87/share it’s pricey. You’re paying six times sales for what amounts to a clothing company.

But you’ll pay nearly that much for Nike (NYSE:NKE), Under Armour’s larger rival, and analysts are telling you to “just buy it” right now.

My guess is you can probably make the same sort of case for Under Armour. Sales doubled between 2011 and 2014, and the company took in nearly its entire 2014 take in the first three quarters of this year. Its profit margins are increasing. It has signed up-and-coming stars like Cam Newton of the Carolina Panthers and Steph Curry of the Golden State Warriors, in preference to the enormous roster at Nike, where names can get lost.

There are two more, better reasons to consider Under Armour. One is the whole “athleisure” trend, which it is at the heart of. People are increasingly wearing athletic gear in preference to other clothes, and Under Armour is a huge beneficiary. They recently added Giselle Bundchen to the roster in order to increase sales to women.

More important, with Under Armour you are buying Kevin Plank. Plank is the company’s founder, he continues to work mostly for stock and he’s 43. This is important. Having a young, but experienced founder at the helm of a company with a relatively stable product base is rocket fuel for corporate ambition.

Kevin Plank is the best operator now working in the clothing business, especially considering that Nike founder Phil Knight is now 77, and he is fiercely ambitious. When you’re buying Under Armour, you’re buying a piece of Kevin Plank.

Athleisure is a huge fashion trend, especially among young people, where it now outstrips the preference for cotton denim. “Athletic and activewear are certainly the new everyday wear and that’s happening no matter what age people are,” as retail consultant Dana Telsey puts it.

Under Armour continues to gain share in activewear, even as activewear continues to gain share in overall retail. One reason is that its clothes have always been form-fitting – they have fabrics in common with privately-held Spanx, which has been updating the corset and would make a great acquisition. So might Lulu (NASDAQ:LULU), especially if its recent rating cut to underperform makes it a cheaper target.

The bottom line is that, if you think Under Armour stock is too pricey for you, it has always been too pricey, and it has continued to perform for years despite that. The company has a young founder-CEO, the winds are at its back, and it is going to grow into today’s valuation. It will probably grow well beyond it.