Under Armour Inc
) jumped 12.2% to close at $69.38 as the company came up with
robust second-quarter 2013 results. Under Armour's quarterly
earnings of 16 cents a share surpassed the Zacks Consensus
Estimate of 14 cents and surged 166.7% from the year-ago
Aided by strong performance of the Apparel category, total
revenue came in at $454.5 million, up 23% year over year and
ahead of the Zacks Consensus Estimate of $448 million.
The company witnessed strong year-over-year performances
across all its segments. Consequently, Under Armour raised its
guidance for 2013. The company now expects net revenue in the
range of $2.23 billion - $2.25 billion, up 22% - 23% year over
year. Earlier, it forecasted 2013 revenues in the range of $2.21
billion - $2.23 billion, representing growth of 21% - 22%.
Under Armour's largest product category, Apparel, once again
witnessed strong sales. In fact this is the 15th straight quarter
in which the segment registered at least 20% growth. Apparel
sales jumped 22.7% to $310.2 million, reflecting strong
performance of the new HeatGear Sonic Baselayer product. The
company's youth apparel businesses and innovative products such
as Studio and Armour Bra also contributed significantly to the
Footwear net revenue soared 21.1% to $81.7 million during the
quarter. The company is witnessing strong demand of its Highlight
cleats and UA Spine products. Moreover, the company is witnessing
improved sales at its various distribution partners following
which the company plans to invest more in shop-in-shops at its
Dick's Sporting Goods Inc
Net revenue in the Accessories category rose 30.1% to $51
million during the quarter, while Licensing revenues elevated
16.7% year over year to $11.6 million.
Baltimore, Md.-based Under Armour announced a 29% surge in
direct-to-consumer net revenue during the quarter, representing
30% of the total revenue.
Gross profit rose 29.6% to $219.6 million during the quarter,
while gross profit margin expanded 240 basis points to 48.3%,
reflecting lower input product cost and favorable sales mix.
Operating income jumped 175.7% to $32.3 million, whereas
operating margin expanded 390 basis points to 7.1%, reflecting
increased gross profit and lower marketing, product innovation
and supply chain costs.
Going forward, Under Armour forecasts a modest expansion in
gross margin for 2013. However, the company raised its operating
income outlook for 2013 in the range of $258 million - $260
million, up 24% - 25% year over year. Earlier, the company
projected operating income in the range of $256 million - $258
million, reflecting growth of 23% - 24% year over year.
This Zacks Rank #3 (Hold) stock opened 3 new Factory House
stores during the quarter, taking the store count to 105. The
company earlier stated that it intends to add 13 total Factory
House stores in
Other Financial Details
Under Armour ended the quarter with cash and cash equivalents
of $223.8 million, long-term debt decreased to $55 million from
$74 million, while shareholders' equity was $877 million.
Capital expenditures came in at approximately $22 million for
the reported quarter. Management now expects 2013 capital
expenditures to be in the range of $85 million - $90 million, up
from its earlier projected range of $80 million - $85
Other Stocks to Consider
Until any further upgrade in Under Armour's Zacks Rank, other
stocks in the Apparel, Footwear & Accessories industry worth
Wolverine World Wide Inc.
Brown Shoe Co. Inc.
), both carrying a Zacks Rank #1 (Strong Buy).
BROWN SHOE CO (BWS): Free Stock Analysis
DICKS SPRTG GDS (DKS): Free Stock Analysis
UNDER ARMOUR-A (UA): Free Stock Analysis
WOLVERINE WORLD (WWW): Free Stock Analysis
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