Piper Jaffray Recommends Buying Under Armour (UA) on This Morning's Weakness

October 25, 2016 9:13 AM EDT
Get Alerts UA Hot Sheet
Price: $26.20 -1.13%

Rating Summary:
    19 Buy, 26 Hold, 1 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 35 | Down: 31 | New: 11
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Shares of Under Armour, Inc. (NYSE: UA) are down 15% in pre-open trade after the company provided a disappointing outlook. Piper Jaffray analyst Erinn Murphy, however, believes the sell-off is overdone and is recommending investors buy on weakness.

Murphy notes: "In the CFO prepared comments which were published, the company indicated FY17 and FY18 sales will be in the low-20% range and maintained its $7.5B 2018 sales guidance provided at the analyst day. That said, operating income growth is now planned to grow mid-teens for FY17 and FY18. This implies EBIT dollars in the low-$600M range by 2018 vs. the company's prior goal of $800M provided at the analyst day. The company is focused on investments in DTC (mobile, factory house footprint) footwear, new category growth (UAS) & international. In addition, mgmt. indicated that growth in apparel would be below the 20% rate indicated at their analyst day."

She commented, "While this is clearly below our expectations, we believe the sell-off in the stock is overdone and would be buyers on weakness."

Piper Jaffray Overweight price target of $44.00

For an analyst ratings summary and ratings history on Under Armour, Inc. click here. For more ratings news on Under Armour, Inc. click here.

Shares of Under Armour, Inc. closed at $37.90 yesterday.

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