Under Armor set to rise 39%, analyst says
Under protection‘s (NYSE: UA) (NYSE: UAA) the share price is expected to rise to $ 17 per share. This is the view of analyst Matthew Boss of JPMorgan Chasefrom JP Morgan, which on Monday raised its price target to that level from the previous $ 12.
Interestingly, although this implies a potential gain of almost 40% on the current price, Boss has maintained its neutral rating on the stock, despite its prediction that Under Armor will exceed analysts’ estimates in its third quarter 2020 results. These should be published this Friday, October 30; the analyst believes the company’s net profit will be well above the average estimate: $ 0.07 per share, against expectations of $ 0.02.
In his research note detailing the increase in the target price, Boss wrote that “our recent work indicates a sequential acceleration in revenue, including a strong September to exit the quarter (= favorable trends in the apparel supported by subsequent re-entry to school in the US) driven by the increased shift to health / well-being and precariousness with additional potential gross margin upward from our modeled pricing / promotional pressure. ”
He is not the only analyst to increase his price target on Under Armor. Citigroup rose its own by 30% (to $ 13) in August, marking the stock with a buy recommendation. More optimistic (and recently), Raymond James Financial last week, its target dropped from $ 15 to $ 20, recommending it as a solid buy.
These new opinions may not correspond to the opinions of investors. Under Armor stock fell 4% on Monday, compared to the 1.9% drop in the S&P 500 index.
This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.