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Under Armour (UAA) Gains But Lags Market: What You Should Know

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In the latest trading session, Under Armour (UAA - Free Report) closed at $18.26, marking a +0.72% move from the previous day. This move lagged the S&P 500's daily gain of 2.44%. Elsewhere, the Dow gained 1.65%, while the tech-heavy Nasdaq added 0.28%.

Heading into today, shares of the sports apparel company had lost 13.83% over the past month, outpacing the Consumer Discretionary sector's loss of 14.06% and lagging the S&P 500's loss of 9.65% 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 4.03% from the year-ago period.

It is also important to note the recent changes to analyst estimates for Under Armour. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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 0.45% lower within the past month. Under Armour is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, Under Armour is holding a Forward P/E ratio of 22.55. This valuation marks a premium compared to its industry's average Forward P/E of 11.46.

Meanwhile, UAA's PEG ratio is currently 0.9. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Textile - Apparel stocks are, on average, holding a PEG ratio of 0.9 based on yesterday's closing prices.

The Textile - Apparel industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 60, putting it in the top 24% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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