Under Armour Inc
), one of the leading developers, marketers and distributors of
branded sports apparel, footwear and accessories, is slated to
report its second-quarter 2012 financial results on July 24, 2012.
The current Zacks Consensus Estimate for the quarter stands at 5
cents a share, reflecting an estimated year-over-year decrease of
about 16.7%. Revenue, as per the Zacks Consensus Estimate, is $359
Under Armour's quarterly earnings of 28 cents a share beat the
Zacks Consensus Estimate of 24 cents, and jumped from 23 cents
earned in the prior-year quarter. Under Armour's net revenue came
in at $384.4 million, up 22.9% from the year-ago quarter, and
surpassing the Zacks Consensus Estimate of $379 million.
Agreement of Estimate Revisions
During the last 30 days, 5 out of 22 estimates have been revised
upwards, while 4 were lowered for the upcoming quarter. Moreover,
for fiscal 2012, story remains more or less same with 6 estimates
(out of 23) being revised upward, while 3 moved in the opposite
In the last seven days, 2 out of 22 estimates have been revised
upwards, while an equal number of estimates were lowered for the
second quarter. Moreover, for fiscal 2012, 4 estimates (out of 23)
made an upward revision, while 1 moved in the opposite
Magnitude of Estimate Revisions
The Zacks Consensus Estimate for the quarter remained stable
over the last 30 days. The analysts remain constructive on the
stock based on the company's growth potential and brand strength.
However, margins are expected to remain soft on account of
increased input costs and markdowns.
Positive Surprise History
With respect to earnings surprises, Under Armour has topped the
Zacks Consensus Estimate over the last four quarters in the range
of 2.4% to 20%. The average remained at 10.6%, indicating that the
company has surpassed the Zacks Consensus Estimate by the same
magnitude in the trailing four quarters.
Under Armour maintains strict control over its brand image, with
an in-house marketing and promotions department, engaged in
designing and advertising while cautiously controlling the
distribution of its products.
The company offers substantial growth opportunities in the long
term through geographic, product/category and direct-to-consumer
expansion. Based on Under Armour's well established brand for
technical product, we expect the company to continue to benefit
from longer-term shifting trends toward performance based products
within the industry.
However, near-term issues like rising inventory levels, higher
input costs and markdowns could possibly limit its future growth
prospects and weaken its product margin levels.
Currently, Under Armour, which competes with
Columbia Sportswear Company
), holds a Zacks #3 Rank that translates into a short-term 'Hold'
COLUMBIA SPORTS (COLM): Free Stock Analysis
NIKE INC-B (NKE): Free Stock Analysis Report
UNDER ARMOUR-A (UA): Free Stock Analysis Report
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