Under Armour (UA) Stretches Guidance After Q3 16% Sales Growth (Update)
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(UPDATE: Added some comments from analysts)
Under Armour, Inc. (NYSE: UA) reported a third-quarter EPS of $0.52, 8 cents better than the analyst consensus of $0.44. Revenue for the quarter was $269.5 million, above the market estimate of $249.04 million.
The Company increased its 2009 fiscal year guidance to $0.85 to $0.87, ahead of the consensus of $0.83. Under Armour has also increase its revenue guidance from $810 million, up to $830 million to $835 million.
Brad Dickerson, Chief Financial Officer of Under Armour, concluded about the third-quarter results, "We remain focused on achieving our financial and strategic goals for 2009 while laying the groundwork for 2010 and beyond.
Under Armour, a leader in athletic-performance apparel, showed a 16.2 percent increase in revenue over the year-ago quarter, with third-quarter apparel net revenues increasing 7.1 percent to 215.4 million.
Areas that have seen significant growth in the Company over the year-ago quarter include footwear sales, up from $13.1 million to $33.0 million, and direct-to-customer sales which accounted for 15 percent of the net revenues for the quarter, up 62 percent over the same quarter last year.
"Continuing to lead in product innovation and aggressively communicating our authentic position in sports will help ensure that the Under Armour Brand continues to resonate with the athletes of this generation," Kevin Plank, Chairman and CEO of Under Armour Inc., stated.
Under Armour is at $32.40 before the market opens today, down 2 percent from yesterday's close.
Analyst Comments:
Michelle Tan, analyst for Goldman Sachs is maintaining a neutral rating on Under Armour, citing the 7 percent increase in sales for the third quarter as disappointing due to increased consumer spending and colder weather. Tan believes that the Company’s long term growth hinges on greater innovation and the success of the footwear line that is not expected to grow in the next year. The Company’s apparel line will need to offset the slower-growing footwear line.
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