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On Wednesday, Stifel analysts revised their price target for Under Armour (NYSE:UA), Inc. (NYSE: UAA) shares, lowering it to $10 from the previous $11, while still holding onto a Buy rating for the stock. The adjustment follows the company’s efforts to rebrand itself with a focus on premium offerings, as well as its recent financial performance. According to InvestingPro data, the stock appears undervalued, with analyst targets ranging from $4 to $14.50, and 6 analysts have recently revised their earnings estimates upward.
Under Armour’s fourth fiscal quarter met earnings expectations, supported by an increase in revenue and gross margin. The guidance for the first fiscal quarter indicates a year-over-year margin improvement of 150 basis points. The company maintains a healthy gross profit margin of 47.9% and a strong current ratio of 2.1, as reported by InvestingPro. However, the company is currently navigating through the complexities of tariffs which have affected the supply and demand dynamics. No full-year 2025 guidance has been issued due to these challenges.
Stifel’s analysts have factored in a projected gross impact of -2.6 percentage points from tariffs, assuming a 10% general tariff and a 30% tariff rate on goods from China. They believe that half of this impact could be mitigated through various strategies. As a result, growth return estimates have been moderated with a new inflection point projected for the fourth fiscal quarter of 2026. The analysts anticipate that Under Armour will be able to achieve flat earnings in FY26E, with potential growth in FY27E.
The company’s strong balance sheet was highlighted, and the current share valuation was deemed attractive, trading at 0.5 times enterprise value to sales (EV/S). The new price target of $10 is based on 0.8 times EV/FY27E Sales and 10.5 times EV/FY27E EBITDA, with projected revenues of $5.3 billion and adjusted EBITDA of $387.5 million for FY27E. With a current market cap of $2.66 billion and an EV/EBITDA of 10x, deeper insights into Under Armour’s valuation metrics and growth potential are available in the comprehensive Pro Research Report on InvestingPro.
In other recent news, Under Armour has faced a series of analyst adjustments following its financial announcements. The company reported a fourth-quarter adjusted earnings per share (EPS) loss of $0.08, which met Wall Street expectations, while revenues declined by 11.4%, slightly better than the anticipated 12.7% decrease. Truist Securities lowered its price target for Under Armour to $7 from $9, maintaining a Hold rating, due to concerns about the company’s revenue guidance and turnaround strategy. Meanwhile, Morgan Stanley (NYSE:MS) reaffirmed its Underweight rating with a $4.00 price target, citing the absence of full-year guidance and the potential for negative mid-term EPS revisions.
BofA Securities also reduced its price target to $8.00 from $10.00, maintaining a Neutral rating, as they anticipate tariff-related challenges but potential for margin recovery in the long term. Evercore ISI and JPMorgan both lowered their price targets to $6.00, with Evercore maintaining an Underperform rating due to competitive pressures and JPMorgan citing revenue declines and adjusted operating margins below expectations. Despite these challenges, Under Armour’s management provided a first-quarter 2026 forecast with an expected EPS of $0.01-$0.03, surpassing Street expectations. The company anticipates a revenue decline of 4-5% year-over-year, which is below the Street’s estimate.
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