Analyst Paul Lejuez of Citi maintained a Hold rating on Under Armour, retaining the price target of $5.00.
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Paul Lejuez has given his Hold rating due to a combination of factors surrounding Under Armour’s strategic decisions and market conditions. The company’s recent move to exit the Curry footwear brand, which was a small and unprofitable segment of their business, reflects a strategic shift to focus on reviving the core Under Armour brand. This decision aligns with management’s broader plan to stabilize North American sales, despite the overall weakness in the basketball category in recent years.
Additionally, while the exit from the Curry brand is not indicative of a complete withdrawal from the footwear market, it suggests a need for Under Armour to reassess their approach in this segment. The expected stabilization of their footwear business by fiscal year 2027 and the slight increase in their operating profit range due to exiting other non-Curry sports assets are positive signs. However, these factors combined with the current market inventory levels and the potential for promotional changes as the holiday season approaches, contribute to the Hold rating as investors await further clarity on the company’s strategic direction and market performance.
According to TipRanks, Lejuez is a 5-star analyst with an average return of 9.2% and a 57.08% success rate. Lejuez covers the Consumer Cyclical sector, focusing on stocks such as Dick’s Sporting Goods, Kohl’s, and Abercrombie Fitch.