
4 Products Under Armour Is Banking on to Reverse Its Latest Nasty Stock Rout
When your quarter sucks, how do you come back?
Under Armour, Inc. (UA) - Get Report is counting on fresh products, new markets, the pixie dust of its celebrity athletes and a major restructuring for a rebound into growth after a weak second quarter revealed on Tuesday. The one-time high growth retailer saw revenue up a mere 9% to $1.1 billion and a net loss of $12 million.
The company's outlook also stunk. Net revenues are expected to grow 9% to 11% versus the previous expectation of 11% to 12%. Operating profits are seen in a range of $280 million to $300 million, excluding one-time items. Under Armour previously expected $320 million.
- Under Armour Shares Are Plunging After Major Restructuring Revealed - Here Are 4 Big Concerns
Shares plunged nearly 9%, to $18.28 in afternoon trading on Tuesday.
With said restructuring comes big expenses, including total estimated pretax restructuring and related charges of some $110 million to $130 million in fiscal 2017.
"The company is starting to emphasize shareholder returns, which we appreciate," Macquarie Research wrote in a note on Tuesday. "However, we anticipate the top line will normalize in the single digits and EBIT margins in the mid-single digits for the foreseeable future."
Among the bright spots for the company are in Asia, including China and Korea.
Here is what Under Armour is banking on in coming months and years.
Watch: Jim Cramer: I'm Not A Fan Of Under Armour, I Like Nike
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