Market Overview

Stay Patient, Under Armour Investors; Your Time May Come Post-Q4 Earnings

Share:
Stay Patient, Under Armour Investors; Your Time May Come Post-Q4 Earnings

Shares of Under Armour Inc (NYSE: UA) (NYSE: UAA) continue trading at multi-year lows due to near-term concerns surrounding the brand's fundamentals and external macro factors — and this creates a buying opportunity.

According to Baird's Jonathan Komp, Under Armour's stock now looks attractive relative to the company's growth profile, which includes an expected 20-percent revenue growth and 25-percent earnings per share growth after 2018.

However, now is not the time to be buying Under Armour's stock, the analyst cautioned. Specifically, the setup in the stock could improve after Tuesday's fiscal fourth-quarter earnings report, which may disappoint investors in certain areas.

Wait And Watch: Here's Why

For example, apparel was likely hurt by the warm weather start in the quarter along with lingering impacts from The Sports Authority bankruptcy. Meanwhile, the company's footwear revenue estimate (consensus of 37 percent versus 95 percent) is "aggressive," especially as sales of the Curry 3 shoe line appears muted.

Komp continued that investors should look beyond Tuesday's earnings report and focus on the various range of drivers ahead, including footwear innovation, a new partnership to sell at Kohl's Corporation (NYSE: KSS) stores and its new Threadborne fabric. These initiatives should ease investor concerns about the company hitting its 2017 financial objectives.

"While we would wait until post-Q4 to be more aggressive, we believe the stock can work from current levels if UA proves an ability to deliver on current 2017 estimates," Komp concluded.

Image Credit: By Maryland GovPics - Under Armour Opening, CC BY 2.0, via Wikimedia Commons

Latest Ratings for UAA

DateFirmActionFromTo
Aug 2020CitigroupMaintainsBuy
Aug 2020SusquehannaUpgradesNegativeNeutral
Aug 2020Deutsche BankMaintainsHold

View More Analyst Ratings for UAA
View the Latest Analyst Ratings

 

Related Articles (UA + UAA)

View Comments and Join the Discussion!

Posted-In: Apparel Apparel CompaniesAnalyst Color Earnings News Previews Analyst Ratings Trading Ideas Best of Benzinga

Latest Ratings

StockFirmActionPT
ZTSTruist SecuritiesMaintains160.0
WLKTruist SecuritiesMaintains60.0
UNVRTruist SecuritiesMaintains21.0
TRIPTruist SecuritiesMaintains25.0
TTDTruist SecuritiesMaintains450.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com