Under Armour Inc (UAA) Stock Hit Hard by Slashed Forecast

Under Armour Inc (NYSE:UAA) stock was hit hard on Tuesday following a guidance cut in its most recent earnings report.

Under Armour Inc (UAA) Stock Hit Hard by Slashed Forecast

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In its earnings report for the third quarter of 2017, Under Armour Inc  cut its outlook for the full year. This includes dropping its earnings per share expectations to between 18 cents and 20 cents. This is far below Wall Street’s earnings per share estimate of 37 cents for the quarter and was a blow to UAA stock.

Under Armour Inc also says that it is expecting its revenue for the full year of 2017 to be up in the low single-digit percentage range. The company reported revenue of $4.83 billion in 2016. Analysts are looking for it to report revenue of $5.22 billion for the year, which is an 8% increase from 2016 revenue.

The update to Under Armour Inc’s guidance for the year also includes its gross margin dropping 220 basis points when compared to the 46.4% reported in 2016. It is also expecting operating income to range from nothing to $10 million in 2017.

Under Armour Inc’s update to its outlook comes alongside one for its current restructuring plan. The company says that it expects to suffer between $140 million to $150 million in pretax charges connected to this effort. The plan was previously only going to include pretax charges ranging from $110 million to $130 million.

UA stock also didn’t get any help from its revenue of $1.41 billion for the third quarter of the year. This is down from its revenue of $1.47 billion from the same time last year. It also didn’t meet Wall Street’s revenue estimate of $1.48 billion for the quarter. Under Armour Inc attributes this to weak sales in North America.

UAA stock was down 17% as of noon Tuesday and is down 53% year-to-date.

As of this writing, William White did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media, https://investorplace.com/2017/10/under-armour-inc-uaa-stock/.

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