Market Overview

3 Takeaways From Under Armour's Q2 Print

3 Takeaways From Under Armour's Q2 Print

Under Armour, Inc. (NYSE: UAA) released its second-quarter earnings report Friday, and the results “beat a low bar,” according to Needham.

The Under Armour Analyst: Rick Patel maintained a Hold rating on Under Armour.

The Under Armour Thesis: Under Armour’s second-quarter performance beat some expectations, Patel said in a Friday note. (See his track record here.)

The analyst named three key takeaways:

• The revenue and gross margin were higher than expected.

Second-quarter sales totaled $707.6 million, outpacing both Needham and Street estimates of $535.9 million and $573.3 million, respectively.

“GM% was +280bp to 49.3% vs our/consensus ests. of (300bp)/(335bp),” the analyst said.

It is “good to see UAA beating expectations but the bar was also very low,” he said.

• The guidance was on par.

Under Armour “guided second-quarter sales to decline 50%-60%; given particularly low visibility, our forecast (as well as consensus) was at the mid-point of guidance,” Patel said.

“This proved conservative and UAA is ‘encouraged by some of the momentum’ experienced in June and July,” he said.

• Under Armour's potential upsides, risks. 

Potential upsides include re-acceleration in North America, stronger-than-expected growth and margin expansion.

Risks include high expectations, increasing competition in activewear, low demand for new products, continued weakness in North America and international deceleration, the analyst said.

“We anticipate stronger growth abroad,” he said. There is “progress being made, but not enough to see significant upside to estimates.” 

UAA Price Action: Class A Under Armour shares lost 8.12% in Friday's session, ending at $10.52. 

Benzinga file photo by Dustin Blitchok. 

Related Link: What's A Wells Notice — And Why Should Under Armour Investors Care?

Latest Ratings for UAA

May 2020CitigroupMaintainsBuy
May 2020UBSMaintainsNeutral
May 2020StifelMaintainsHold

View More Analyst Ratings for UAA
View the Latest Analyst Ratings


Related Articles (UAA)

View Comments and Join the Discussion!

Posted-In: Needham Rick PatelAnalyst Color Earnings News Reiteration Analyst Ratings Best of Benzinga

Latest Ratings

NGMPiper SandlerInitiates Coverage On30.0
ETNBPiper SandlerInitiates Coverage On54.0
FLXNOppenheimerInitiates Coverage On19.0
ALTPiper SandlerInitiates Coverage On80.0
CBAYPiper SandlerInitiates Coverage On12.0
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