Under Armour, Inc. (UAA) Sales/Inventory Disconnect Increases, BTIG Reiterates Sell
- Wall St posts third straight quarterly loss as inflation weighs, recession looms
- Intel's Autonomous Unit Mobileye Files U.S. IPO, Defying Weak Market Conditions
- Nike (NKE) Drops 9% as Inventory Surges 44%, Analysts See Attractive Valuation
- Hollywood Super Agent Attempts to Open Door for Twitter-Musk Settlement - Bloomberg
- Dollar up on euro as quarter ends, commodity led currencies sink
News and research before you hear about it on CNBC and others. Claim your 1-week free trial to StreetInsider Premium here.
BTIG analyst Camilo Lyon reiterated a Sell rating and $5.00 price target on Under Armour, Inc. (NYSE: UAA) after the company reported less bad Q2 results but did not offer a plan that would enable the brand to return to normalized growth.
The analyst stated "we reiterate our SELL rating as the challenges it faces have only been compounded by COVID-19. Given the company's bloated inventory position (inventory +24% vs. sales -41%), 2H20 gross margins are expected to be down meaningfully as promotions and off-price
selling ensue. We note that the strong gross margin performance in Q2 (+283bps) was temporary as higher margin e-commerce sales were disproportionately stronger and no off-price orders were shipped. Consequently, those dynamics reverse in the back half of the year as the company is now forced to return to the unhealthy cycle of using the off-price channel to move excess product, thus compressing 2H20 gross margins, only to face tougher "inflated sales" comparisons in 2H21 that will further challenge its growth outlook".
Shares of Under Armour, Inc. closed at $10.60 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- CyberArk Software Well Positioned For Double-Digit Profitability this Coming Year - Cowen
- Voya Financial (VOYA) an Inflation Net Beneficiary - Piper Sandler
- Under Armour Inc (UAA) option implied volatility elevated as shares near 52-week low
Create E-mail Alert Related CategoriesAnalyst EPS Change, Analyst EPS View
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!