Under Armour's New CEO May Go Through Learning Curve Before Delivering, Says Analyst

  • Wedbush analyst Tom Nikic reiterated an Outperform rating on the shares of Under Armour Inc UAA with a price target of $11.00.
  • The company announced the appointment of Stephanie Linnartz as President and CEO following an extensive search of internal and external candidates.
  • Her tenure will become effective on February 27, 2023, said the analyst.
  • Colin Browne, who currently serves as interim CEO, will resume his prior role as COO upon Ms. Linnartz’s arrival.
  • Linnartz most recently served as the President of Marriott International Inc MAR beginning in February 2021.
  • She has extensive experience building omnichannel experiences, developing efficient operational structures, and currently oversees Marriott’s rewards program, the analyst cited.
  • She has also developed successful multi-year partnerships with the NFL, NCAA, and the Mercedes-AMG PETRONAS F1 Team, the analyst quipped.
  • Nikic thinks Linnartz appears to be a capable executive and has experience working at a global business and executing initiatives that are applicable to both hotels and apparel. 
  • That said, the biggest concern would be the lack of athletic industry experience.
  • It’s a highly competitive and challenging industry, and the analyst’s concern would be that there may be a learning curve, particularly in the areas of the business that are not translatable to hotels.
  • So the analyst thinks investors will take a wait-and-see approach, with bulls hoping that an outsider’s point of view will be enough to shake things up and allow UAA to fulfill its long-term potential.
  • Price Action: UAA shares are trading lower by 3.74% at $9.73 on the last check Thursday.
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