Under Armour, Inc. (UAA): Are The Signals Sending Scary Signs?

On December 27, 2019, Under Armour, Inc. (NYSE:UAA) shares lost -1.61% or -0.35 points to close at $21.45 with a thin trading volume of 2.033 million shares. The company now has a market cap of $9.04 billion and currently has 421.53 million outstanding shares. Under Armour, Inc. (UAA) stock has accumulated 19.23 percent of market value in 21 trading days.

UAA stock’s trailing 3-year beta is 0.56, meaning there will be a lower rate of return, although posing a lower risk. The part of a firm’s profit given to each outstanding share of regular stock was $0.33 share in the trailing 52 weeks. The stock’s value surged 21.39 percent year to date (YTD) compared to a rise of 19.77 percent in 52 week’s period. The firm’s shares are still trading -22.62 percent below its 1-year high of $27.72 and 28.14 percent up from 52-week low of $16.74. The average consensus ranking on the company is 2.7, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a sell.

Past records have indicated that shares in Under Armour, Inc. rose on 7 different earnings reaction days and we have yet to see whether this trend will play out and remain in place when the company reports upcoming earnings.

Let’s take a glimpse at some insider activity at Under Armour, Inc. (NYSE:UAA) and observe the pattern. The earliest insider trade happened on 02/22/2019. Fipps Paul parted with a total of 3.11 thousand shares of the firm at average share price of $21.55. The total amount for the sale was set at $66.93 thousand. On completing this exchange, the Chief Digital Officer account balance was 11.01 thousand shares. The stock lost -0.46 percent from that insider sale. On 05/11/2018, Frisk Patrik, President & COO, did a purchase of 14 thousand shares at a price of $18.5 per share. This increased 259 thousand shares to the insider’s fortune and the stock experienced a 15.95 percent rally in price since the news became public. This exchange saw 14 thousand shares get into the President & COO account.

On 05/07/2018, Director McDermott William R recorded a sale transaction valued at $115.19 thousand. The sale at $17.7 a share has eliminated 6.51 thousand shares from the insider’s portfolio position. Meanwhile, shares price witnessed 21.19 percent increase since the transaction reporting date. The company insider is left with 59.66 thousand shares remaining in the account. SANDERS HARVEY, who works as Director at the company, performed a sale of 6.51 thousand shares in a transaction worth $119.58 thousand. The disposal recorded on 05/03/2018 was priced at $18.36 per share. The stock price soared 16.83 percent since the transaction. SANDERS HARVEY currently holds a stake of 235.43 thousand in UAA stock which is worth $5.05 million after the insider selling.

The stock is lingering around the initial support level of $21.26. After this, the following support is at the zone of $21.06. Up until the time the UAA stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 65.37 on the daily chart, and this may be a cause for concern. In case the price goes below $21.06 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $21.77 level may cause a pull-back move approaching $22.08 mark.

Under Armour, Inc. (UAA) shares are trading at a P/E ratio of 64.94 times earnings posted in the trailing 12 months. The industry UAA deals with has an average P/E of 25.8. Its P/B ratio is standing at 4.54X compared to the 5.26 industry average. It is additionally sporting a 1.73 on the Price-to-Sales ratio, compared to the industry’s P/S average of 0.38. Under Armour, Inc. has a 46.3% gross profit margin, with its operating margin around 2.9%. Alongside this, the company’s net profit margin currently stands at 2.1%.