Under Armour (UAA) Stock Forecast & Price Target

Under Armour's positive outlook is supported by a significant expansion in gross margin, which increased 240 basis points year-over-year, contributing to earnings per share (EPS) growth that surpassed initial guidance by 65 basis points. The company's strategic focus on lowering supply chain costs and reducing promotions has led to improved financial metrics, including a consistent rise in EBIT margin, projected to expand by 200-250 basis points over the next two fiscal years. Additionally, revenue rebasing in North America is expected to facilitate a return to growth in FY26 and FY27, bolstering the company's trajectory in the competitive athletic apparel market.

Under Armour is experiencing a significant decline in revenue, with projections indicating a nearly 10% drop to $5.14 billion in FY25, driven by a 13% decline in North America and a 5% decline in the international sector. The North American business faced an 8% decline in Q3, largely attributed to decreased direct-to-consumer sales and proactive limitations on promotions, despite a modest increase in full-price sales. Furthermore, the company continues to deal with challenges from prolonged promotion strategies and inconsistent wholesale execution, leading to an anticipated continued decrease in consolidated revenues into FY26.