Jordan Spieth-Induced Spike In Under Armour Fades After Earnings
Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.
Under Armour Inc (NYSE: UA) shares were trading lower by $4 at $83.76 in Tuesday's session. Despite posting in-line EPS of $0.05 with sales of $804.9 million vs. $802.53 estimates and raising fiscal sales outlook, the issue is under selling pressure in today's session.
A possible reason for the decline is the run-up in its share price prior to the report. As expected, shares underwent a "Spieth Spike" as the not-so-well-known golfer pulled off a surprising victory in the 2015 Masters Championship on April 12.
As the young golfer dominated the field, prominently sporting his Under Armour attire, investors flocked to the issue the following Monday, April 13, rallying the issue from $83.75 to $85.11. The upward momentum pushed the issue to its all-time high this week at $88.78, before falling back to settle at $87.76.
When the company did not produce a blow-out quarter, the Spieth premium built into the issue evaporated. After bottoming at $83.25 earlier in Tuesday's session, it returned to the $84 level, or the same level it was trading at before Spieth's Masters win.
© 2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.