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Analyzing Target Price Changes for Under Armour

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Dec. 14 2018, Updated 4:25 p.m. ET

Two changes so far

After the investor meeting on December 12, there have been two price changes for Under Armour. On December 13, Telsey Advisory reduced its target price for Under Armour from $25.00 to $23.00. Jefferies slashed its price target to $28.00 from $30.00. We can expect more revisions in the coming days.

Currently, analysts’ 12-month average target price for UAA stock is $21.19, which reflects 12.9% upside to the December 13 stock price.

At the meeting, Under Armour underscored that the North America segment’s performance will be subdued. It expects its North American revenue CAGR to grow in the range of 1%–3% by 2023. The segment is the major contributor to the company’s overall revenue.

Under Armour operates in Europe, the Middle East, Asia-Pacific, and Latin America, which are gaining strong momentum. Nevertheless, the company’s rising selling, general, and administrative costs are also a concern.

Of the 33 analysts covering Under Armour stock on December 13, 18% have a “buy” rating and 58% have a “hold” rating. The remaining 24% have a “sell’ rating.

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Ratings for peers

For Nike (NKE), 60% of the 37 analysts covering the stock have a “buy” rating while 35% have a “hold” rating. For Nike, the mean target price is $87.24, indicating a 19.6% upside on December 13.

About 12% of 25 analysts provided a “buy” rating for The Gap (GPS), and 76% rated it a “hold. The Gap’s 12-month average target price is $29.75, indicating an 11.7% upside.

Of the 16 analysts covering Columbia Sportswear (COLM), 56% gave it a “buy” rating while the remainder rated it a “hold.” Columbia Sportswear’s mean target price is $101.87, indicating a 20.5% upside.

About 46% of 13 analysts provide a “buy” rating for Skechers (SKX), and the rest rated it a “hold.” Skechers’ 12-month average target price is $32.55, indicating a 38.5% upside.

 

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