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Under Armour, Inc. (NYSE: UA) — Stocks have slumped for the past few days, which naturally causes some concern among investors. But those looking for bullish opportunities are being presented with a wealth of possibilities from stocks that have pulled back to supporting trendlines.
One such candidate is Under Armour, the performance apparel company that caters to a crowd similar to Nike, Inc. (NYSE: NKE), although Columbia Sportswear Company (NASDAQ: COLM) is more UA’s size.
UA shares retreated more than 4% yesterday, and have lost more than 6% in the past four trading days. OK, that’s the bad news.
The good news is that UA is up 28% for the year, far outpacing the 5% logged by the hulking Nike, which dropped yesterday about as much as UA.
On the chart, UA’s 20-day and 50-day moving averages just completed a bullish cross. The last such cross was followed by a 25% rally from mid-March through late April.
In addition, the stock has pulled back to the $35 level, the site of UA’s 20-day moving average and a couple of peaks in May.
We’re also seeing some put accumulation at the $35 strike in the July series, which should also lend support.
And did we mention that the stock was upgraded from “neutral” to a “buy” yesterday? The analyst placed a $38 target on the shares.
That sounds good to us, seeing as the stock put in a 21-month high just above $38 earlier this week.
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