Under Armour’s Mixed Financial Outlook: Balancing Margin Recovery Potential and Near-Term Challenges

Bank of America Securities analyst Lorraine Hutchinson maintained a Hold rating on Under Armour (UAA – Research Report) today and set a price target of $8.00.

Lorraine Hutchinson’s rating is based on a combination of factors affecting Under Armour’s current financial outlook. The company reported a fourth-quarter loss per share that aligned with expectations, but the results were impacted by higher selling, general, and administrative expenses, which offset better-than-expected sales and margins. Hutchinson notes that while there is potential for long-term margin recovery, the uncertainty surrounding tariffs poses a near-term challenge.
Additionally, Under Armour’s gross margins have improved due to supply chain efficiencies and reduced discounting, yet the competitive environment in the Asia-Pacific region remains a concern, with sales declining significantly. The company’s management has not provided full-year guidance, reflecting the uncertainty in the market. These factors combined lead Hutchinson to maintain a Hold rating, as the balance between potential recovery and existing challenges suggests a cautious approach.

In another report released yesterday, Barclays also maintained a Hold rating on the stock with a $6.00 price target.