Under Armour (UAA) Stock Forecast & Price Target

Under Armour is expected to experience gross margin expansion of 70-120 basis points year over year, driven by a favorable channel mix and lower marketing spend. Although there are some supply chain headwinds related to geopolitical tensions, the company remains confident in trends stabilizing in FY27 and expects improved sales growth throughout the year. Additionally, the company is forecasting significant gross margin expansion in FY27, driven by potential tariff refunds, pricing actions, and channel mix. However, the company's FY27 revenue guidance of slight declines points to continued pressure in North America, reflecting a challenging retail environment and softer carryover from previous orderbooks. Despite these challenges, Under Armour is focused on elevating its brand and rolling out innovative products, which is expected to drive wholesale growth and provide gross margin lift in FY27. Overall, while Under Armour has made progress in terms of rationalizing SKUs and reducing promotions, there are still doubts about the sustainability of their turnaround efforts and we maintain a Market Perform rating with a price target of $6.

Under Armour is struggling to meet its own growth and profit targets as its revenue falls behind in key regions like North America and EMEA, offsetting slight gains in APAC and Latin America. The company's competitive market and push towards international expansion may create further challenges for growth and profitability. Despite a strong brand and potential for international success, the company's current financials and forecast for higher expenses and limited revenue growth make it a less compelling investment opportunity.