Under Armour Stock Is Off and Running!

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Much to the dismay of bears who had been on the offensive of late, Under Armour (NYSE:UAA) delivered a slam-dunk earnings report for the other side. And for investors willing to wager, it’s looking like a good time to suit up as a bull in UAA stock. Let me explain.

UAA stock bears saw an upsetting Q3 earnings report and reaction Tuesday. Shares of the heavily shorted athletics outfitter vaulted higher by nearly 28% after Under Armour delivered bullish quarterly results in championship style.

In a nutshell, UAA stock screamed past profit forecasts and beat sales views while sporting surprise modest year-over-year growth. Under Armour also delivered increasing margins and reduced troublesome inventory tied to prior mismanagement, marketing and product missteps over the past couple years.

So is it “game over!” for UAA stock bears? There’s no guarantees of course, but you have to like what’s happening as Under Armour transitions from a freshman hotshot and growth stock superstar to a more durable and seasoned industry veteran capable of holding its own against the likes of Nike (NYSE:NKE) or Adidas (OTCMKTS:ADDYY).

The promising results look even better as Under Armour’s management team, headed by the notoriously brash Kevin Plank, offered a message of controlled optimism stating the brand’s multi-year transformation is on track, but appreciating the turnaround is still in the early innings of the game.

Bottom line, it’s time to go long UAA stock before the crowd jumps on the bandwagon.

UAA Stock Price Charts

UAA Stock Daily Price Chart
Source: Charts by TradingView

Tuesday’s all-around terrific performance looks even better when appreciating UAA stock’s daily price chart. The jump in share price follows a fairly common and healthy corrective move of 30% over the last few months after Under Armour raced higher by nearly 70% in the first half of 2018.

The reaction by Wall Street puts shares of Under Armour into the right side of a five-month base after clearing the 62% retracement level. Near term, shares of UAA are modestly overbought as evidenced by Tuesday’s upper Bollinger Band penetration. But with a supportive stochastics setup, it’s not exactly compelling evidence that shares will or even pause for very long before heading higher.

Source: Charts by TradingView

Additionally and as shown above, the big picture of UAA stock’s weekly chart points to 2018’s emerging uptrend as one which is just now coming into its own. It also reflects a bullish price trend that’s a world removed from Under Armour’s unsustainable heyday when Wall Street couldn’t get enough of UAA’s bullish narrative. As such, it’s this strategist’s opinion that now is even a better time for investors to begin accumulating Under Armour shares in anticipation of more slam dunks to come in 2019 and beyond.

Investment accounts under Christopher Tyler’s management currently own positions in Under Armour (UAA) and its derivatives, but no other securities mentioned in this article. The information offered is based upon Christopher Tyler’s observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional options-based strategies and related musings, follow Chris on Twitter @Options_CAT and StockTwits.

The information offered is based upon Christopher Tyler’s observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits.


Article printed from InvestorPlace Media, https://investorplace.com/2018/10/under-armour-stock-is-off-and-running/.

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