Report
Valens Research

UAA - Embedded Expectations Analysis - 2021 02 10

Under Armor, Inc. (UAA:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 103.5x Uniform P/E. At these levels, market expectations are for material improvements in Uniform ROA, but management may be concerned about their retail capabilities, position in footwear, and ability to drive profitable growth

Specifically, management may lack confidence in their ability to continue investing in retail capabilities, authenticate themselves as a premium player in the footwear space, and innovate their footwear pipeline. They may also have concerns about the launch of Machina and the slow pace of recovery in their Team Sports category. Moreover, they may lack confidence in their ability to further reopen store locations in Latin America, improve the performance of their Connected Footwear platform, and sustain profitable growth in their regional e-commerce business
Underlying
Under Armour Inc. Class A

Under Armour is engaged in the development, marketing and distribution of apparel, footwear and accessories for men, women and youth. The company provides HEATGEAR?, which is designed to be worn in warm to hot temperatures under equipment or as a single layer; and COLDGEAR?, which is designed to wick moisture from the body while circulating body heat from hot spots to help maintain core body temperature. The company's footwear products include running, basketball, cleated sports, slides, training, and outdoor. The company provides digital fitness subscriptions, along with digital advertising through its MapMyFitness, MyFitnessPal and Endomondo applications.

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Valens Research
Valens Research

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