Analyst Round-Up Following Under Armour's Q4 Results, Strong Outlook
Under Armour (NYSE: UA) released better-than-expected fourth-quarter results and strong FY 2014 guidance Thursday morning, driving its stock price up as much as 22 percent to $106.65. The price action in stock continues recent bullish momentum in the name; Under Armour's stock price hit a 52-week high of $88.77 as recently as Jan. 10th.
In the conference call following its earnings release, CEO and Chairman Kevin Plank, reported the opening of the “first two UA Brand House retail stores” and planned to continued to “make key investments in Women's, Footwear and International businesses to drive long-term growth.” Under Armour's acquisition of MapMyFitness in November is expected to return dividends by the end of this year and is hoped to expand the brand's digital presence.
Company execs noted that a focus in women's apparel and has also helped expand product mix, in addition to product categories like ColdGear, HotGear and fleece offerings.
With Under Armour's shares now trading at an all-time high, investors are handily bullish. Here is a look at some of the sell-side analyst sentiment on the company's quarter:
Dave Weiner, analyst at Deutsche Bank, noted that the scarcity of “meaningful revenue growth in the apparel and footwear sector” in today's tough environment make Under Armour's results and guidance “all the more beneficial for the stock.”
Bank of America Merrill Lynch's Robert Ohmes reiterated his Buy recommendation, and maintained a “beat and raise pattern through 2014”. Ohmes noted a PT of $95 and said he expects “near-term top-line momentum to continue driven by expansion in core apparel, Direct to Consumer, and improving footwear trends.” Longer-term, the BofA analyst predicts revenue to triple, driven by growth in Footwear and International. Risks to the company include increased investments for key launches and the potential for missed launches; and pressure from a tough US environment, margin squeeze from high inventory levels, and delayed traction in international, according to Ohmes.
UA stock was up approximately 11 percent premarket and ahead of the release. Shares of Under Armour closed up 22.93 percent at $104.76 at the end of Thursday's session.
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