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Under Armour (UAA) Gains As Market Dips: What You Should Know

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Under Armour (UAA - Free Report) closed the most recent trading day at $21.48, moving +1.13% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.06%. Elsewhere, the Dow gained 0.59%, while the tech-heavy Nasdaq lost 0.3%.

Prior to today's trading, shares of the sports apparel company had lost 11.43% over the past month. This has lagged the Consumer Discretionary sector's gain of 1.83% and the S&P 500's gain of 5.76% in that time.

Investors will be hoping for strength from Under Armour as it approaches its next earnings release. On that day, Under Armour is projected to report earnings of $0.06 per share, which would represent a year-over-year decline of 50%. Our most recent consensus estimate is calling for quarterly revenue of $1.46 billion, up 4.04% from the year-ago period.

It is also important to note the recent changes to analyst estimates for Under Armour. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.08% lower within the past month. Under Armour is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, Under Armour currently has a Forward P/E ratio of 26.3. Its industry sports an average Forward P/E of 14.09, so we one might conclude that Under Armour is trading at a premium comparatively.

We can also see that UAA currently has a PEG ratio of 1.05. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Textile - Apparel industry currently had an average PEG ratio of 1.02 as of yesterday's close.

The Textile - Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 76, which puts it in the top 30% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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