Under Armour (UAA) Stock Forecast & Price Target

Under Armour's positive outlook is supported by a significant increase in licensing revenue, which rose 12%, demonstrating strong growth in both North America and international markets. The company's gross margin expanded by approximately 70 basis points to 48.2%, indicating improved profitability. Additionally, brand perception metrics, including an increase in commerce NPS scores by 18 points and the successful "We Are Football" campaign, suggest heightened consumer engagement and awareness, particularly among younger demographics.

Under Armour's outlook is negatively impacted by a projected decline of over 50% in adjusted EPS for FY26, primarily driven by increased debt-related interest expenses and an unfavorable tax rate significantly higher than the previous year. Additionally, a 14% drop in footwear sales—a key category—reflects a challenging demand environment exacerbated by ongoing product portfolio management efforts. The company's guidance for 3QF26, which indicates lower-than-expected sales and severe operating margin contraction across regions, underscores its struggle to meet market demand and adapt effectively to changing consumer preferences.