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Under Armour (UAA) Lined Up for Q4 Earnings: Factors to Note
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Under Armour, Inc. (UAA - Free Report) is likely to register an increase in the top line when it reports fourth-quarter 2021 earnings on Feb 11, before the market opens. The Zacks Consensus Estimate for revenues stands at $1,461 million, indicating an improvement of 4.2% from the prior-year reported figure.
The bottom line of this developer, marketer and distributor of apparel, footwear, and accessories is expected to decrease year over year. The Zacks Consensus Estimate for fourth-quarter earnings per share has been stable at 6 cents over the past 30 days. The figure suggests a sharp decline from earnings of 12 cents reported in the year-ago period.
For 2021, the consensus mark for revenues is pegged at $5.62 billion, which indicates growth of 25.6% from last year. Again, the consensus estimate for full-year earnings per share stands at 77 cents, suggesting a meaningful improvement from an adjusted loss of 26 cents reported in the year-ago period.
This Baltimore, MD-based company has a trailing four-quarter earnings surprise of 244.5%, on average. In the last reported quarter, the company’s bottom line surpassed the Zacks Consensus Estimate by a significant margin of 106.7%.
Key Things to Note
Under Armour’s robust operating model, strength in direct-to-consumer business and investments across product and marketing have been helping in meeting strong demand. The company’s strategy to focus on improving sales through product innovation, investments in own stores, acceleration of e-commerce capabilities, and selling more inventory at full price bode well. These might have favored the fourth-quarter performance. We also note that the company’s international business has been a significant revenue driver.
The company has been focusing on strengthening its brand through enhanced customer connections and a strict go-to-market process. It has been using data and analytics capabilities to understand consumer behavior and drive brand interest across categories like training and running.
On its last earnings call, management projected an increase of approximately 25% in full-year revenues. This reflects a high-twenties percentage growth rate in North America and a mid-thirties percentage growth rate in the international business. The company guided gross margin expansion of about 130 basis points when compared with the prior-year adjusted gross margin of 48.6%. This reflects benefits from pricing and changes in foreign currency. The company had forecast full-year adjusted earnings to reach 74 cents a share.
However, divestment of the high gross margin business, MyFitnessPal, might have negatively impacted the quarter. Also, higher freight and logistics costs due to COVID-19-related supply chain constraints remain a headwind. Management had projected a 6-7% year-over-year increase in full-year SG&A expenses.
Under Armour, Inc. Price, Consensus and EPS Surprise
We note that the Zacks Consensus Estimate for fourth-quarter revenues for Apparel and Footwear categories are pegged at $1,035 million and $284 million, indicating growth of 11.1% and 17.9% year over year, respectively. The consensus mark for Accessories stands at $121 million, suggesting a decline of 16.6% from the prior-year quarter.
The Zacks Consensus Estimate for revenues at North America, EMEA, and Asia-Pacific segments are pegged at $996 million, $202 million and $240 million, respectively. These figures suggest an increase of 7.8% and 25.3% for North America and EMEA on a year-over-year basis, respectively. The same for Asia-Pacific indicates growth of 4%. The Zacks Consensus Estimate for revenues of $51 million for Latin America suggests a decline of about 9.3% from the year-ago period.
What Does the Zacks Model Unveil?
Our proven model predicts an earnings beat for Under Armour this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. You can see the complete list of today’s Zacks #1 Rank stocks here.
Under Armour has a Zacks Rank #3 and an Earnings ESP of +8.89%.
3 More Stocks With Favorable Combination
Here are three other companies you may want to consider as our model shows that these too have the right combination of elements to post an earnings beat:
Gildan Activewear (GIL - Free Report) currently has an Earnings ESP of +9.57% and a Zacks Rank #2. The company is likely to register an increase in the bottom line when it reports fourth-quarter fiscal 2021 numbers. The Zacks Consensus Estimate for quarterly earnings per share of 58 cents suggests an increase of 29% from the year-ago reported number.
Gildan Activewear’s top line is expected to increase year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $731 million, which suggests an increase of 5.9% from the prior-year quarter. GIL has a trailing four-quarter earnings surprise of 85%, on average.
Five Below (FIVE - Free Report) currently has an Earnings ESP of +0.71% and a Zacks Rank #3. The company is likely to register bottom-line improvement when it reports fourth-quarter fiscal 2021 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $2.48 suggests an increase of 12.7% from the year-ago quarter’s reported figure.
Five Below's top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.01 billion, which indicates an improvement of 17.1% from the figure reported in the prior-year quarter. FIVE has a trailing four-quarter earnings surprise of 22.4%, on average.
Target (TGT - Free Report) currently has an Earnings ESP of +0.50% and a Zacks Rank #3. The company is expected to register bottom-line growth when it reports fourth-quarter fiscal 2021 results. The Zacks Consensus Estimate for quarterly earnings per share of $2.85 suggests growth of 6.7% from the year-ago quarter’s reported figure.
Target’s top line is anticipated to rise year over year. The consensus mark for revenues is pegged at $31.53 billion, indicating an increase of 11.3% from the year-ago quarter. TGT has a trailing four-quarter earnings surprise of 19.7%, on average.
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Under Armour (UAA) Lined Up for Q4 Earnings: Factors to Note
Under Armour, Inc. (UAA - Free Report) is likely to register an increase in the top line when it reports fourth-quarter 2021 earnings on Feb 11, before the market opens. The Zacks Consensus Estimate for revenues stands at $1,461 million, indicating an improvement of 4.2% from the prior-year reported figure.
The bottom line of this developer, marketer and distributor of apparel, footwear, and accessories is expected to decrease year over year. The Zacks Consensus Estimate for fourth-quarter earnings per share has been stable at 6 cents over the past 30 days. The figure suggests a sharp decline from earnings of 12 cents reported in the year-ago period.
For 2021, the consensus mark for revenues is pegged at $5.62 billion, which indicates growth of 25.6% from last year. Again, the consensus estimate for full-year earnings per share stands at 77 cents, suggesting a meaningful improvement from an adjusted loss of 26 cents reported in the year-ago period.
This Baltimore, MD-based company has a trailing four-quarter earnings surprise of 244.5%, on average. In the last reported quarter, the company’s bottom line surpassed the Zacks Consensus Estimate by a significant margin of 106.7%.
Key Things to Note
Under Armour’s robust operating model, strength in direct-to-consumer business and investments across product and marketing have been helping in meeting strong demand. The company’s strategy to focus on improving sales through product innovation, investments in own stores, acceleration of e-commerce capabilities, and selling more inventory at full price bode well. These might have favored the fourth-quarter performance. We also note that the company’s international business has been a significant revenue driver.
The company has been focusing on strengthening its brand through enhanced customer connections and a strict go-to-market process. It has been using data and analytics capabilities to understand consumer behavior and drive brand interest across categories like training and running.
On its last earnings call, management projected an increase of approximately 25% in full-year revenues. This reflects a high-twenties percentage growth rate in North America and a mid-thirties percentage growth rate in the international business. The company guided gross margin expansion of about 130 basis points when compared with the prior-year adjusted gross margin of 48.6%. This reflects benefits from pricing and changes in foreign currency. The company had forecast full-year adjusted earnings to reach 74 cents a share.
However, divestment of the high gross margin business, MyFitnessPal, might have negatively impacted the quarter. Also, higher freight and logistics costs due to COVID-19-related supply chain constraints remain a headwind. Management had projected a 6-7% year-over-year increase in full-year SG&A expenses.
Under Armour, Inc. Price, Consensus and EPS Surprise
Under Armour, Inc. price-consensus-eps-surprise-chart | Under Armour, Inc. Quote
Sneak Peek into Estimates
We note that the Zacks Consensus Estimate for fourth-quarter revenues for Apparel and Footwear categories are pegged at $1,035 million and $284 million, indicating growth of 11.1% and 17.9% year over year, respectively. The consensus mark for Accessories stands at $121 million, suggesting a decline of 16.6% from the prior-year quarter.
The Zacks Consensus Estimate for revenues at North America, EMEA, and Asia-Pacific segments are pegged at $996 million, $202 million and $240 million, respectively. These figures suggest an increase of 7.8% and 25.3% for North America and EMEA on a year-over-year basis, respectively. The same for Asia-Pacific indicates growth of 4%. The Zacks Consensus Estimate for revenues of $51 million for Latin America suggests a decline of about 9.3% from the year-ago period.
What Does the Zacks Model Unveil?
Our proven model predicts an earnings beat for Under Armour this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. You can see the complete list of today’s Zacks #1 Rank stocks here.
Under Armour has a Zacks Rank #3 and an Earnings ESP of +8.89%.
3 More Stocks With Favorable Combination
Here are three other companies you may want to consider as our model shows that these too have the right combination of elements to post an earnings beat:
Gildan Activewear (GIL - Free Report) currently has an Earnings ESP of +9.57% and a Zacks Rank #2. The company is likely to register an increase in the bottom line when it reports fourth-quarter fiscal 2021 numbers. The Zacks Consensus Estimate for quarterly earnings per share of 58 cents suggests an increase of 29% from the year-ago reported number.
Gildan Activewear’s top line is expected to increase year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $731 million, which suggests an increase of 5.9% from the prior-year quarter. GIL has a trailing four-quarter earnings surprise of 85%, on average.
Five Below (FIVE - Free Report) currently has an Earnings ESP of +0.71% and a Zacks Rank #3. The company is likely to register bottom-line improvement when it reports fourth-quarter fiscal 2021 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $2.48 suggests an increase of 12.7% from the year-ago quarter’s reported figure.
Five Below's top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.01 billion, which indicates an improvement of 17.1% from the figure reported in the prior-year quarter. FIVE has a trailing four-quarter earnings surprise of 22.4%, on average.
Target (TGT - Free Report) currently has an Earnings ESP of +0.50% and a Zacks Rank #3. The company is expected to register bottom-line growth when it reports fourth-quarter fiscal 2021 results. The Zacks Consensus Estimate for quarterly earnings per share of $2.85 suggests growth of 6.7% from the year-ago quarter’s reported figure.
Target’s top line is anticipated to rise year over year. The consensus mark for revenues is pegged at $31.53 billion, indicating an increase of 11.3% from the year-ago quarter. TGT has a trailing four-quarter earnings surprise of 19.7%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.