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The Comeback Story Of This Year's NBA Finals? Steph Curry's Sneaker Line

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The Comeback Story Of This Year's NBA Finals? Steph Curry's Sneaker Line
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Nearly every signature shoe release from Under Armour Inc. (NYSE: UAA) Steph Curry’s line has been blasted on social media.

After debuting the latest model, the Curry 4, in the first game of the NBA Finals, it appears Under Armour may have finally gotten one right.

Better Days Ahead

Wells Fargo believes Under Armour may be poised for better days ahead, primarily due to the more favorable social-media response (94 percent positive sentiment) to the Curry 4.

Although if analysts are basing future sales on social media sentiment against previous releases Curry 2.5 and 3 disasters, the bar was extremely low.

Under Armour is expected to change its strategy this time around when the Curry 4 drops in September, likely with a more limited release to better gauge the market.

“Retailers might buy the product conservatively to start, waiting for evidence of a resurgence before re-committing to the Curry franchise,” said Wells Fargo analyst Tom Nikic.

While Under Armour management already guided for strong footwear growth of 20-25 percent in the second half of the year so far the response for the Curry 4 was desperately needed.

“We are encouraged (cautiously) by the prospects for the Curry 4 shoe, and the potential “halo effect” it could have on the brand,” added Nikic.

Comeback

Poor consumer response from past releases has played a big role in Under Armour’s current slump. It's probable that Nike Inc (NYSE: NKE) also played a role.

While Under Armour’s stock decline started after the Golden State Warriors lost a 3-1 lead in the 2016 NBA Finals, Kevin Durant’s decision to join the Golden State Warriors right after also delivered a significant blow to the brand. Golden State was seen as an "Under Armour team," before Durant, a key Nike endorser, joined the team and stole some of Curry’s thunder.

Many believe Durant joined the super team to win his first championship, but other think this may have been a guise to stop Under Armour’s threatening momentum in basketball.

Wells Fargo maintained a Market Perform rating on Under Armour, with a $19 price target.

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'Chef Curry' Can't Seem To Cook Up A Strong Shoe Rollout For Under Armour

Latest Ratings for UAA

DateFirmActionFromTo
Feb 2019Morgan StanleyMaintainsEqual-WeightEqual-Weight
Jan 2019Goldman SachsUpgradesNeutralBuy
Jan 2019OTR GlobalUpgradesNegativeMixed

View More Analyst Ratings for UAA
View the Latest Analyst Ratings

Posted-In: curry 4 Kevin Durant LeBron James NBA FinalsAnalyst Color Sports Analyst Ratings General Best of Benzinga

 

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