Under Armour (UAA) AI Stock Analysis

• Market Cap: $2.88B
• Dividend Yield: N/A
• Average Volume (3M): 10.54M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.00
• Revenue Growth: -7.47%
• EPS Growth: -131.70%
• Country: US
• Employees: 6,800
• Sector: Consumer Cyclical
• Sector Strength: 60
• Industry: Apparel - Manufacturers
• EPS (TTM): -0.08
• Shares Outstanding: 188,822,720
• 10 Day Avg. Volume: 10,840,403
• 30 Day Avg. Volume: 10,543,728
• PEG Ratio: -0.35
• Price to Book (P/B): 4.53
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 26.82
• Enterprise Value/Market Cap: 1.32
• Enterprise Value/Revenue: 0.17
• Enterprise Value/Gross Profit: 1.51
• Enterprise Value/Ebitda: 6.13
• 1Y Price Target: $6.87
• Price Target Upside: -0.29% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 19

• Rating: 47 Neutral
• Price Target: ―

Under Armour is currently facing substantial financial and operational challenges, highlighted by declining revenue and profitability, weak technical indicators, and a challenging valuation. Despite these issues, the improved gross margins and strategic adjustments noted in the earnings call provide a glimmer of hope. The stock's overall score reflects these mixed elements, with significant risks and some potential for recovery.

Positive Factors

Gross Margins

Gross margins increased driven by supply chain efficiencies, lower discounting and promos, and a favorable product mix.

Management Strategy

The evolution of the management of the Under Armour brand outweighs the fact that no FY26 guidance was provided.

Revenue Performance

Revenues for the quarter came in above implied guidance, despite being down 10%.

Negative Factors

Earnings Uncertainty

Potential for negative medium-term earnings per share revisions remain.

Market Position

There is room for valuation de-rating from high levels, and disadvantaged positioning in an increasingly fragmenting sportswear market.

Product Innovation Challenges

Under Armour lags peers in product innovation and newness, with lead times of up to 18 months to drive critical mass in launch products.

Under Armour Business Overview & Revenue Model

Company Description

Under Armour, Inc., together with its subsidiaries, engages in the developing, marketing, and distributing performance apparel, footwear, and accessories for men, women, and youth. The company offers its apparel in compression, fitted, and loose fit types. It also provides footwear products for running, training, basketball, cleated sports, recovery, and outdoor applications. In addition, the company offers accessories, which include gloves, bags, headwear, and sports masks; and digital subscription and advertising services under the MapMyRun and MapMyRide platforms. It primarily offers its products under the UNDER ARMOUR, UA, HEATGEAR, COLDGEAR, HOVR, PROTECT THIS HOUSE, I WILL, UA Logo, ARMOUR FLEECE, and ARMOUR BRA brands. The company sells its products through wholesale channels, including national and regional sporting goods chains, independent and specialty retailers, department store chains, mono-branded Under Armour retail stores, institutional athletic departments, and leagues and teams, as well as independent distributors; and directly to consumers through a network of 422 brand and factory house stores, as well as through e-commerce websites. It operates in the United States, Canada, Europe, the Middle East, Africa, the Asia-Pacific, and Latin America. Under Armour, Inc. was incorporated in 1996 and is headquartered in Baltimore, Maryland.

How the Company Makes Money

Under Armour generates its revenue primarily through the sale of its branded performance apparel, footwear, and accessories. The company's revenue streams are diversified across wholesale, direct-to-consumer, and licensing operations. The wholesale segment involves selling products to retail stores and distributors, while the direct-to-consumer segment includes sales through Under Armour-branded stores and its online platform. Additionally, Under Armour benefits from licensing agreements that allow third parties to produce and sell products under the Under Armour brand. Key factors contributing to its earnings include strategic partnerships with athletes, sports teams, and events, which enhance brand visibility and consumer engagement. The company also invests in technology and innovation to maintain a competitive edge in the sportswear market.

Under Armour Financial Statement Overview

Summary

Under Armour is facing financial challenges with declining revenue and profitability. Despite a stable balance sheet with moderate leverage, its cash flow generation is weak, impacting its overall financial health. The company needs to focus on improving operational efficiencies and cash flow management to enhance its financial standing.

Income Statement

Under Armour's TTM data shows a decline in revenue and profitability. The gross profit margin is approximately 47.5%, indicating a decent gross profitability, but the company is currently experiencing a net loss, reflected by a negative net profit margin of -2.52%. The EBIT and EBITDA margins are also weak at -2.25% and 0.29% respectively, indicating challenges in operational efficiency and profitability.

Balance Sheet

The company has a moderate debt-to-equity ratio of about 0.66, suggesting a balanced use of debt and equity. However, the return on equity is negative, reflecting current financial underperformance. The equity ratio stands at 42.9%, indicating a stable financial structure with a reasonable level of equity in the assets.

Cash Flow

Under Armour's TTM cash flow statement highlights challenges in cash generation with a negative free cash flow. The operating cash flow to net income ratio is low, reflecting inefficiencies in cash generation from operational activities. The negative free cash flow to net income ratio further underscores liquidity pressures.

Breakdown	TTM	Mar 2024	Mar 2023	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	4.21B	5.70B	5.90B	5.68B	4.47B	5.27B
Gross Profit	2.01B	2.63B	2.64B	2.86B	2.16B	2.47B
EBITDA	524.72M	372.34M	399.04M	667.95M	153.15M	423.19M
Net Income	240.03M	232.04M	374.46M	360.06M	-549.18M	92.14M
Balance Sheet
Total Assets	4.84B	4.76B	4.86B	4.99B	5.03B	4.84B
Cash, Cash Equivalents and Short-Term Investments	788.07M	858.69M	711.91M	1.67B	1.52B	788.07M
Total Debt	1.30B	1.44B	1.52B	1.50B	2.01B	1.30B
Total Liabilities	2.69B	2.61B	2.86B	2.90B	3.35B	2.69B
Stockholders Equity	2.15B	2.15B	2.00B	2.09B	1.68B	2.15B
Cash Flow
Free Cash Flow	-370.50M	203.64M	-197.71M	595.07M	120.57M	363.23M
Operating Cash Flow	-35.61M	353.97M	-9.91M	664.83M	212.86M	509.03M
Investing Cash Flow	-340.41M	-105.33M	-152.80M	-68.35M	66.34M	-147.11M
Financing Cash Flow	310.10M	-78.69M	-126.38M	-418.74M	436.85M	-137.07M

Under Armour Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.89
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UAA, the sentiment is Positive. The current price of 6.89 is above the 20-day moving average (MA) of 6.71, above the 50-day MA of 6.37, and below the 200-day MA of 7.65, indicating a neutral trend. The MACD of 0.10 indicates Positive momentum. The RSI at 55.57 is Neutral, neither overbought nor oversold. The STOCH value of 70.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for UAA.

Under Armour Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ZGN	76 Outperform	$3.48B	25.79	8.89%	1.51%	2.26%	-37.52%
KTB	73 Outperform	$3.66B	16.12	56.32%	3.16%	1.19%	3.19%
Sector *	66 Neutral	£1.85B	11.46	6.20%	3.02%	0.61%	-17.57%
COLM	63 Neutral	$3.36B	15.69	12.34%	1.95%	-1.69%	-4.01%
HBI	50 Neutral	$1.63B	―	-23.24%	―	-33.72%	-892.32%
UAA	47 Neutral	$2.88B	―	-9.95%	―	-7.47%	-131.70%
VFC	47 Neutral	$4.61B	―	-2.39%	3.04%	-7.52%	94.28%