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Under Armour Stock Surges after Beating 1Q17 Estimates

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Under Armour Stock Surges after Beating 1Q17 Estimates PART 1 OF 5

Under Armour Beats 1Q17 Earnings and Revenue

Under Armour’s 1Q17 results

The Baltimore-based Under Armour (UAA) reported its results for 1Q17 on Thursday, April 27. The results relate to the three-month period ending ended March 31, 2017.

The company posted a 7% YoY (year-over-year) increase in revenues to $1.1 billion, beating the consensus by $8 million. It reported a loss of 1 cent per share, compared to a profit of 4 cents per share in the first quarter last year. This loss was, however, better than Wall Street’s expectations of a 4 cent per share loss.

Under Armour Beats 1Q17 Earnings and Revenue

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Investors reacted positively to the company’s better-than-expected results.  The stock price surged 10% and closed at $21.67 on April 27, 2017.

ETF investors seeking to add exposure to UAA can consider the PowerShares S&P 500 High Beta Portfolio (SPHB), which invests ~1% of its portfolio in the company.

Valuations update and stock recommendation

UAA’s stock is currently trading at a one-year-forward-price-to-earnings ratio of 50x, compared to 22.5x for Nike (NKE), 20.9x for Columbia Sportswear (COLM), and 22.8x for Lululemon Athletica (LULU) as of April 27, 2017.

The average 12-month price target by 33 analysts covering Under Armour is $21.33, indicating a downside of 2% over the next year.

Nine of 34 analysts have recommended a “buy” on the stock while 18 have recommended a “hold” and six analysts have set a “sell” rating on the company.

What this series is about

This series is an earnings overview of Under Armour’s 1Q17 results. We’ll discuss the company’s financial performance during the quarter by evaluating its key revenue drivers and profitability. We’ll also discuss Wall Street’s view on Under Armour, its stock market performance, and the company’s current valuation.

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