We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Under Armour's (UAA) Growth Strategies Appear Encouraging
Read MoreHide Full Article
Under Armour, Inc.’s (UAA - Free Report) focus on strengthening its brands through enhanced customer connections, effective innovations, better price points and a loyalty program should help it to stand firmly in the challenging operating market. The company has been progressing smoothly on its multi-year transformation plan.
We note that the shares of this athletic footwear, apparel and accessories dealer have increased 8.1% over the past month, outperforming the industry’s 0.6% rise. Analysts seem optimistic about the company. The Zacks Consensus Estimate for fiscal 2025 sales and earnings per share is currently pegged at $6.23 billion and 64 cents, respectively. These estimates show corresponding increases of 5% and 29.7% year over year.
Strategies in Detail
Under Armour’s focus on reinforcing brands, effective innovations and strict go-to-market processes appears encouraging. Additionally, the company strives to boost its operating model as well as return greater profitability and value to shareholders. The company’s long-term growth strategy is focused on improving sales through product innovation, building long-term relationships with key wholesale partners, investments in its own stores and digitization to directly reach customers, and selling more inventory at full price.
Image Source: Zacks Investment Research
UAA is focusing on digitization by converting real-time data and analytics to drive brand interest and consideration within its largest categories of training and running. Under Armour also initiated a loyalty program in North America, UA Rewards, on a pilot basis. Restructuring initiatives, cost management, inventory balance and emphasis on productivity should position the company well for growth.
To aid overall growth, management has announced three priorities to drive clarity and business alignment across the company. The initiative is named Protect This House 3 or PTH3. These priorities include driving global brand heat, staying relentlessly focused on elevating design and building better products, and driving growth in the United States. With this plan, management is optimistic about creating a more advantageous position to unlock consistent and sustainable growth for its shareholders over the long term.
In addition, Under Armour has been trying to boost its direct-to-consumer business through store-expansion initiatives and enhancement of its e-commerce platform. Management has been investing in boosting digital capabilities to drive growth in the direct-to-consumer channel. This includes buy online and pick-up in store facilities and flexible payment capabilities. In the fourth quarter of fiscal 2023, the company’s direct-to-consumer revenues increased 3% to $454 million due to a 6% rise in e-commerce revenues, which represented 46% of the total direct-to-consumer business in the quarter.
Furthermore, Under Armour is enhancing its global footprint and market share. Though the company generates a major portion of its revenues from the North America region, it intends to expand business operations to other parts of the world. It has also rolled out e-commerce platforms in countries like Mexico, Australia, New Zealand and Chile. Revenues from the international business increased 16% (up 21% on a currency-neutral basis) in the fiscal fourth quarter.
To wrap up, Under Armour is well-poised for growth based on the aforementioned strengths. An expected long-term earnings growth rate of 9.9% for this current Zacks Rank #3 (Hold) company further demonstrates strength.
RCL has a trailing four-quarter earnings surprise of 26.4%, on average.
The Zacks Consensus Estimate for RCL’s 2023 sales and earnings per share (EPS) indicates increases of 48.7% and 162.9%, respectively, from the year-ago period’s reported levels.
Crocs, which offers casual lifestyle footwear and accessories, presently carries a Zacks Rank #2 (Buy). The expected EPS growth rate for three to five years is 15%.
The Zacks Consensus Estimate for Crocs’ current financial-year sales and EPS suggests growth of 13.1% and 5.6% from the year-ago period’s reported figure. CROX has a trailing four-quarter earnings surprise of 19.6%, on average.
lululemon athletica is a yoga-inspired athletic apparel company. LULU carries a Zacks Rank of 2, at present.
The Zacks Consensus Estimate for lululemon athletica’s current financial-year sales and EPS suggests growth of 17% and 18.4%, respectively, from the year-ago corresponding figures. LULU has a trailing four-quarter earnings surprise of 9.9%, on average.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Under Armour's (UAA) Growth Strategies Appear Encouraging
Under Armour, Inc.’s (UAA - Free Report) focus on strengthening its brands through enhanced customer connections, effective innovations, better price points and a loyalty program should help it to stand firmly in the challenging operating market. The company has been progressing smoothly on its multi-year transformation plan.
We note that the shares of this athletic footwear, apparel and accessories dealer have increased 8.1% over the past month, outperforming the industry’s 0.6% rise. Analysts seem optimistic about the company. The Zacks Consensus Estimate for fiscal 2025 sales and earnings per share is currently pegged at $6.23 billion and 64 cents, respectively. These estimates show corresponding increases of 5% and 29.7% year over year.
Strategies in Detail
Under Armour’s focus on reinforcing brands, effective innovations and strict go-to-market processes appears encouraging. Additionally, the company strives to boost its operating model as well as return greater profitability and value to shareholders. The company’s long-term growth strategy is focused on improving sales through product innovation, building long-term relationships with key wholesale partners, investments in its own stores and digitization to directly reach customers, and selling more inventory at full price.
Image Source: Zacks Investment Research
UAA is focusing on digitization by converting real-time data and analytics to drive brand interest and consideration within its largest categories of training and running. Under Armour also initiated a loyalty program in North America, UA Rewards, on a pilot basis. Restructuring initiatives, cost management, inventory balance and emphasis on productivity should position the company well for growth.
To aid overall growth, management has announced three priorities to drive clarity and business alignment across the company. The initiative is named Protect This House 3 or PTH3. These priorities include driving global brand heat, staying relentlessly focused on elevating design and building better products, and driving growth in the United States. With this plan, management is optimistic about creating a more advantageous position to unlock consistent and sustainable growth for its shareholders over the long term.
In addition, Under Armour has been trying to boost its direct-to-consumer business through store-expansion initiatives and enhancement of its e-commerce platform. Management has been investing in boosting digital capabilities to drive growth in the direct-to-consumer channel. This includes buy online and pick-up in store facilities and flexible payment capabilities. In the fourth quarter of fiscal 2023, the company’s direct-to-consumer revenues increased 3% to $454 million due to a 6% rise in e-commerce revenues, which represented 46% of the total direct-to-consumer business in the quarter.
Furthermore, Under Armour is enhancing its global footprint and market share. Though the company generates a major portion of its revenues from the North America region, it intends to expand business operations to other parts of the world. It has also rolled out e-commerce platforms in countries like Mexico, Australia, New Zealand and Chile. Revenues from the international business increased 16% (up 21% on a currency-neutral basis) in the fiscal fourth quarter.
To wrap up, Under Armour is well-poised for growth based on the aforementioned strengths. An expected long-term earnings growth rate of 9.9% for this current Zacks Rank #3 (Hold) company further demonstrates strength.
Eye These Solid Picks
Some better-ranked companies are Royal Caribbean (RCL - Free Report) , Crocs (CROX - Free Report) and lululemon athletica (LULU - Free Report) .
Royal Caribbean sports a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
RCL has a trailing four-quarter earnings surprise of 26.4%, on average.
The Zacks Consensus Estimate for RCL’s 2023 sales and earnings per share (EPS) indicates increases of 48.7% and 162.9%, respectively, from the year-ago period’s reported levels.
Crocs, which offers casual lifestyle footwear and accessories, presently carries a Zacks Rank #2 (Buy). The expected EPS growth rate for three to five years is 15%.
The Zacks Consensus Estimate for Crocs’ current financial-year sales and EPS suggests growth of 13.1% and 5.6% from the year-ago period’s reported figure. CROX has a trailing four-quarter earnings surprise of 19.6%, on average.
lululemon athletica is a yoga-inspired athletic apparel company. LULU carries a Zacks Rank of 2, at present.
The Zacks Consensus Estimate for lululemon athletica’s current financial-year sales and EPS suggests growth of 17% and 18.4%, respectively, from the year-ago corresponding figures. LULU has a trailing four-quarter earnings surprise of 9.9%, on average.