Tuesday, FBR Capital Markets initiated coverage of Under Armour, Inc. (UA) stock with an Outperform rating and a price target of $34.
Analyst Eric Tracy noted that although Under Armour may be reaching an inflection point in its life cycle, set to retrench its footwear business to position for longer-term growth, he believes that the company is one of the few apparel vendors that has legitimate long-term top-line growth potential supported by apparel product extensions, domestic distribution expansion, international penetration, and ultimately, the scaling of its footwear business.
The analyst said that the strength of the Under Armour brand, a solid management team, and a clean balance sheet position the company to weather the difficult consumer environment and should allow it to take share as sector rationalization unfolds.
Currently, UA is down $0.21 or 0.72% and trading at $28.88.
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