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Under Armour Beat on 4Q17 Sales, Reported In-Line Earnings

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Under Armour’s 4Q17 results

Baltimore-based Under Armour (UAA) reported results for the fourth quarter of fiscal 2017 (or 4Q17) on Tuesday, February 13, 2018. The results relate to the three-month period ended December 31, 2017.

The company reported a 4.6% YOY (year-over-year) increase in revenues to $1.4 billion, beating the consensus by $60 million. Earnings were in line with the forecasts, with UAA breaking even at $0 per share. Read Parts 2, 3, and 4 of this series to find out more about this sportswear company’s key revenue drivers and profitability.

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Guidance update

Under Armour’s management has forecast a low single-digit rate increase in its fiscal 2018 sales. It expects 25% growth in international markets to offset the mid-single-digit decline in North America sales.

Its gross margin is expected to increase 50 basis points to 45.5% of sales since the company expects to benefit from lower promotional activities, declining product costs, a favorable shift in channel mix, and positive changes in foreign currency.

Stock performance

Under Armour’s revenue beat in 4Q17 seemed to turn investors bullish and drove UAA stock 17% higher on Tuesday, February 13, 2018. Its YTD (year-to-date) losses were converted to gains. The company now has a profit of 1%. Read Part 5 of this series to know about the company’s recent stock performance and analysts’ actions on the company.

ETF investors seeking to add exposure to Under Armour can consider the Guggenheim S&P 500 Equal Weight Consumer Discretionary ETF (RCD), which invests 0.8% of its portfolio in the company.

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