|Bid||178.26 x 800|
|Ask||178.37 x 800|
|Day's Range||177.39 - 181.03|
|52 Week Range||110.71 - 194.25|
|Beta (3Y Monthly)||1.26|
|PE Ratio (TTM)||46.79|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
When it comes to Under Armour (NYSE:UAA) stock, I've loved to play the contrarian for some time. And being contrarian on UAA stock has been immensely profitable over the past year.Back in November 2018, UAA stock was flying high at $24 after the athletic apparel brand reported third- quarter numbers which easily beat average expectations. I warned that the pop was unsustainable and that the bearish thesis actually looked pretty good. By December 2018, after Under Armour had a bad Investor Day and amid a broader market selloff, UAA stock had dropped to below $17.I recommended that investors buy the dip of UAA stock. Within a month, Under Armour stock had rebounded by more than 20%, at which point I advised investors to sell Under Armour stock. UAA stock continued to rally well after that, all the way to $28, and I kept insisting that the rally was unsustainable.InvestorPlace - Stock Market News, Stock Advice & Trading TipsIn late July, Under Armour reported underwhelming numbers. Ever since, UAA stock has fallen off a cliff. Today, the stock trades hands at $18, roughly where it was in late 2018. * 10 Cheap Dividend Stocks to Load Up On Now it's time to buy the dip of Under Armour stock again. Here's why. Under Armour Stock Is Too CheapThere are three main reasons why it's time to buy the dip of UAA stock again. The first reason is that the stock is now way too cheap.My core thesis on Under Armour is pretty simple.: UAA is the wrong company in the right space. Under Armour is the wrong company because it hasn't innovated or adapted to trends . Namely, the athletic apparel market has pivoted from performance apparel to lifestyle clothes.Under Armour hasn't made that pivot, and as a result, it continues to launch products that - while good - aren't as relevant as the new lifestyle products from Nike (NYSE:NKE), Lululemon (NASDAQ:LULU), and Adidas (OTCMKTS:ADDYY). That's why Under Armour has continued to grow at a much slower pace than those peers (in Q2, for example, UAA's constant currency revenue growth was just 3%).Nonetheless, the athletic apparel space is the right space to be in now. Consumers increasingly want to live active and healthy lifestyles and look like they do so. This is creating a rising tide that's lifting all boats in the athletic apparel space, even the ugliest boats like Under Armour. That's why Under Armour's revenue has continued to grow, despite the company's lack of product innovation.This dynamic will persist. Going forward, Under Armour's top line looks poised to rise about 5% annually , with healthy margin drivers through continued gross margin expansion and positive operating leverage. I've said time and time again that UAA's earnings per share should reach $1,50 by fiscal 2025. Based on Nike's average forward price- earnings multiple of 25, UAA stock should reach $37.50 in 2024. Discounted back by 10% per year, that equates to a 2019 price target for UAA stock of about $23.Thus, in late July, UAA stock was way overvalued. Now it's way undervalued. The Optics Will ImproveThe second reason to buy the dip of Under Armour stock is that it will look more attractive over the next few months.A big driver behind the recent selloff of Under Armour stock is President Donald Trump's threat to impose tariffs on more Chinese imports. Ostensibly, that's a bad thing for all athletic-apparel companies, since a bunch of athletic-apparel products are made in China. As a result, investors have indiscriminately sold athletic-apparel stocks over the past two weeks.But Under Armour's China exposure isn't huge (only 10% of its products are made in China ). Further, a big chunk of these tariffs have already been delayed , yet another sign that Trump doesn't actually want the trade war to escalate that much and is just doing some chest-puffing with the tariffs he's already announced.All these trade-war fears will likely cool over the next several months as they have always done after trade-war flare-ups under Trump. This cooling will provide a lift for UAA stock. The Stock Is OversoldThe third reason to buy the dip of Under Armour stock is that the stock is technically way oversold, and is due for a bounce-back.The Relative Strength Index of UAA stock has dropped to 20, well into oversold territory. The last time the RSI of UAA stock was this low was back in late 2018. Under Armour stock proceeded to bottom in late 2018 and rally by more than 20% over the next month.A similar dynamic could play out this time around. Consequently, the technicals are saying that UAA stock is near a bottom and on the verge of a nice bounce-back rally. The Bottom Line on UAA StockUnder Armour is the wrong company in the right space., so Under Armour stock will not be a long term winner. Instead, it's a "buy the dip, fade the rally" stock. Right now, UAA stock is in the middle of its biggest selloff in recent memory, meaning that it's time to start thinking about buying the shares on weakness.As of this writing, Luke Lango was long UAA, NKE, and LULU. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Cheap Dividend Stocks to Load Up On * The 10 Biggest Losers from Q2 Earnings * 5 Dependable Dividend Stocks to Buy The post Why It's Time to Buy the Dip of Under Armour Stock appeared first on InvestorPlace.
By John Jannarone Luxury apparel company Canada Goose Holdings Inc. intends for gross margins on new products to reach those of its down-filled parkas over the long term and its upcoming footwear products should also deliver best-in-class profits. That’s according to an interview CEO Dani Reiss gave to IPO Edge Wednesday after the company posted […]
How to trade growth stocks successfully? The prudent investor will make an effort to buy a high-quality stock breaking out on a follow-through day.
Canada Goose Holdings Inc. Reports Fiscal First Quarter Results Wednesday By John Jannarone Canada Goose Holdings Inc.’s unusual – and evolving – business model has ruffled some feathers recently. But for those who do their homework, there’s a chance to reap some luxurious gains. The Toronto-based outerwear maker, which was founded in 1957 make snowmobile […]
Lululemon Athletica has been a big winner for longs over the past three years but the price action and our favorite indicators have been weakening lately. In this daily bar chart of LULU, below, we can see an uptrend from late December. The daily On-Balance-Volume (OBV) line has been declining from early July which is different from the prior two tests of the moving average in March and late May.
In a stock market correction, investors should build up watchlists. Twitter, Microsoft, Lululemon, MercadoLibre and HubSpot are in or near buy zones.
YY's (YY) second-quarter 2019 results are likely to be hurt by increasing investments on content and technology despite an expanding subscriber base.
Today we'll evaluate Lululemon Athletica Inc. (NASDAQ:LULU) to determine whether it could have potential as an...
Activision Blizzard (ATVI) second-quarter 2019 results are likely to benefit from strength in popular franchises despite lack of major game releases and intensifying competition.
As if the retail sector didn't have enough to worry about, a new threat has now emerged. On August 1, President Trump announced that the US is implementing 10% tariffs on a further $300 billion of Chinese goods, starting September 1. On the announcement, retail stocks plunged, with the SPDR S&P Retail ETF down over 3%.“The list of products these tariffs will hit are almost entirely consumer oriented… This new 10% tariff on Chinese imports is a direct hit on consumer products and family budgets, plain and simple” the Retail Industry Leaders Association wrote in a statement. Most retailers expect to pass the tariffs on to consumers, and multiple price rises could damage overall consumer spending. “We’re very concerned this will be a long-term cost baked into what consumers will pay,” Matt Priest, chief executive of the Footwear Distributors and Retailers of America, said in The New York Times.And UBS analyst Jay Sole didn’t provide much reassurance when he told investors: “Department store P/E valuations look low today, but the market may be underestimating how negatively impacted their earnings might be from tariffs.” In particular, the analyst singled out names like Macy’s (M), Nordstrom (JWN) and Kohl’s (KSS) as most at risk. This was a call echoed by other firms including Goldman Sachs and Credit Suisse. Nordstrom, for example, is currently trading down a whopping 34% year-to-date. That’s with a Hold analyst consensus.However there are still some retail names that look compelling. UBS has singled out three specific names with the least risk attached. These are the stocks best-positioned to outperform with the new tariffs says the firm. Let’s take a closer look now: Nike Inc (NKE)Just do it. The sportswear giant has managed to maintain significant Street support despite the tariff updates. It’s hard to deny that Nike has considerable China exposure. Company filings reveal that 23% of Nike footwear and 27% of apparel is manufactured in China, while FactSet calculates that 15% of Nike revenue is directly tied to the region.Nonetheless the stock’s diversified global footprint and strong pricing power are keeping analysts on-side. “Fundamentally, NKE is arguably in its strongest position over the past few years, with robust CC revenue growth, healthy underlying gross margin expansion, a continued eye on the horizon through transformational investments, and strong/healthy growth in DTC/digital” cheers five-star Guggenheim analyst Robert Drbul. He has a buy rating on the stock and $100 price target. Indeed, best performing analysts have a bullish Strong Buy consensus on Nike right now. In the last three months, the stock has received 8 buy ratings vs just 1 hold rating. Meanwhile the $98 average analyst price target suggests sizable upside potential of just over 20%. Lululemon Athletica (LULU)Lululemon is excelling in the rapidly growing world of athleisure. The company is another retailer singled out by UBS as having the least risk to the new tariffs. Lululemon imports only 6% of its total finished goods from China, limiting its direct exposure. "We are committing to higher air-freight usage as the hedge against disruption in ocean shipping lanes as we approach the key dates related to tariff increases," Lululemon CFO Patrick Guido revealed on the June earnings call. However the higher costs associated with increased import duties and air cargo are likely to keep gross margin "flat to modestly up" this quarter, vs 54.8% last year, Guido added.Year-to-date the stock has soared 47%, boosted by stellar first-quarter earnings results and a new customer loyalty program. “We continue to see Lululemon uniquely positioned at the intersection of trends and positioned well to both recruit new consumers to the brand and expand the offering to generate more revenue per guest,” wrote Stifel Nicolaus analyst Jim Duffy.He believes the new loyalty program, named ‘Practice’, can yield $0.50-plus in incremental earnings power “and more aggressive assumptions point to potential for a $1-plus boost for future years.”Top analysts have a cautiously optimistic take on LULU, with a Moderate Buy consensus. That breaks down to 11 buy ratings and 5 hold ratings published on the stock in the last three months. The $197 average price target indicates upside potential of 10% from current levels. VF Corp (VFC)VF Corp boasts a diverse portfolio of popular brands including Vans and The North Face. It’s the third stock singled out by the firm as best positioned to cope with tariff risk.As VFC itself states “The word that best describes our global sourcing strategy is “balanced.” We’re not overly dependent on any given region or country. This allows us to competitively manage cost, as well as source closer to end markets.” According to the company, China accounts for 9% of produced VF units. That’s with Americas responsible for 35% produced VF goods, and Vietnam 25%. Overall, we can see VFC still scores a Strong Buy consensus from top analysts. Out of 6 analysts polled, 5 rate the stock a buy. Plus the $100 average analyst price target translates into upside potential of over 20%. “VFC is one of the best managed and operationally efficient companies in our coverage universe and the spin-off of the slow growing Jeans business further enhances its growth profile, in our view. VFC continues to evolve its portfolio to ensure resources and focus are allocated to the fastest growing brands that are generating the highest return on investment” cheers top Susquehanna analyst Sam Poser. He notes that the strong success at Vans (up 20% in 1Q20), and now The North Face is a positive indicator of future growth at VFC’s other brands including Timberland and Dickies.Discover the Street's best-rated Trending Stocks now
Prestige Consumer (PBH) delivers better-than-expected fiscal Q1 results, driven by solid consumption trends. However, both earnings and sales fall year over year.
Dow Jones stock Nike is testing a new buy point. But shares have lagged the broader market in recent months while earnings growth has cooled. Is the athletic apparel giant a good buy now?
(Bloomberg Opinion) -- Shares of Procter & Gamble Co. reached an all-time high this week after the company released a blockbuster quarterly earnings report. Organic sales – a measure that strips out currency movements and other factors – were the highest in more than a decade, with each of its major divisions posting at least mid-single digit growth from a year earlier on this measure. An upbeat sales and earnings forecast for 2020 capped off the win.It’s a remarkable change in momentum for a consumer-goods behemoth that only a year ago was licking its wounds after a bruising proxy fight and was desperate to show it could do better amid tough competition from insurgent and private brands.So how did P&G do it? Many factors, including a new organizational structure and revamped marketing strategy, are playing a role. Importantly, though, it’s also done a good job of figuring out how to get shoppers to pay more for its products. It’s here that I want to focus, as there are some lessons in what P&G has done for another corner of the consumer world – the apparel industry – which badly needs to do the same thing.One way P&G has gotten consumers to splurge is through product innovation. Pampers Pure – a version of its familiar diaper that is made with plant-based and sustainable materials – has helped lift sales recently in its baby division. This product, new to the market in 2018, capitalizes on consumers’ growing preference for eco-friendly products while also giving the company a reason to charge a premium price. This year, it followed up with Pure products in its Always and Tampax brands.Higher-priced items have also been driving strong growth in its laundry division. Tide Pods and Gain Flings carry a 50% price premium compared to liquid detergent, and yet shoppers scoop them up because the format offers obvious convenience.Here’s why I think the apparel industry should pay attention to this dynamic, even though selling consumer staples is a somewhat different beast. Chains such as Gap Inc., Ann Taylor and Macy’s Inc., have become over-reliant on discounts, which can cheapen their image and hurt margins. Lately, their approaches seem to largely center on using technology to present more personalized deals, or to introduce fresh loyalty programs as a way to offer value. And it hasn’t done much to return them to relevance.What if, instead, they focused on product innovation, like P&G does, to get people to pay full price? In apparel, there are at least a couple of ways to do this.One is working to develop garments with clear functionality or performance advantages, such as a white t-shirt that isn’t see-through or pants that don’t shrink in the wash. This, in fact, is how Lululemon Athletica Inc. has become a rare bright spot in the clothing business. Women are willing to pay $98 for its leggings because its distinct fabrics and designs result in a comfort and durability that shoppers deem worth the price tag. No wonder the athletic apparel retailer has booming sales and practically never discounts.Product innovation could also mean fashion newness – creating pieces that people simply feel like they have to have. As Andrea Felsted and I noted in a recent column, Inditex SA’s Zara does it all the time. J. Crew Group, for all its current woes, managed to win with fashion innovation during the apex of the Mickey Drexler-Jenna Lyons era, when its sequins-as-daywear and oversize necklaces became a go-to look every chain was forced to imitate.It isn’t just product innovation, though, that has allowed P&G to win with pricing; it has also raised prices on existing items under banners such as Bounty, Charmin and Puffs as it has sought to offset elevated commodity costs. In some ways, this is a risky move, as private-label brands are there as a cheaper alternative.Here’s the thing, though: P&G is fond of saying “performance drives brand choice.” In other words, executives trust that, for all but the most budget-conscious shoppers, people are going to be loyal to the product they think works best.Clothing sellers should consider embracing this philosophy. Mid-priced apparel chains appear to be battle-scarred by two factors: the recession that ended a decade ago, and the concurrent competitive incursions from value-oriented players such as H&M operator Hennes & Mauritz AB and TJX Cos., owner of the T.J. Maxx chain. That confluence of events seemed to spook them into believing that the only thing that would ever get shoppers to open their wallets is discounts.I don’t think that’s true. In today’s upbeat economy, I am confident plenty of once-devoted Banana Republic, Loft or Express Inc. shoppers would pony up for work attire they perceived to be durable, or for a date-night dress they thought was a knockout. The mental calculus wouldn’t be so different from why that same woman springs for Charmin even when the generic toilet paper is right next to it on the shelf: It performs better, so it’s worth the cost.Mall-based clothing chains are in a rut. It’s high time for some more creative thinking – and perhaps some unusual inspiration – if they’re going to dig out of it.To contact the author of this story: Sarah Halzack at firstname.lastname@example.orgTo contact the editor responsible for this story: Beth Williams at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Sarah Halzack is a Bloomberg Opinion columnist covering the consumer and retail industries. She was previously a national retail reporter for the Washington Post.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Lululemon (LULU) has an impressive earnings surprise history and currently possesses the right combination of the two key ingredients for a likely beat in its next quarterly report.
The Zacks Analyst Blog Highlights: SeaWorld Entertainment, Rent-A-Center, Callaway Golf, BJ's Wholesale Club and Lululemon Athletica
Earnings season is winding down, but retailers are just starting to report their quarterly results. Shares of major retailers ended lower on Wednesday after Macy's reported disappointing results for the second-quarter. Jharonne Martis, Refinitiv's Director of Consumer Research, joined The Final Round to discuss what the company's results means for retail in general, as well as trends in the retail sector.
Former Lululemon CEO, Christine Day is focussing on the plant-baaed and healthy meal sector in her role as CEO of Luvo. Yahoo Finance's Julie Hyman, Adam Shaipro, and Scott Gamm sit down with Day.