Wall Street was running away from shares of Under Armour Inc. (UAA) on Tuesday, May 1.
The stock fell 6.3% after initially rising following the release of first-quarter earnings during the premarket session.
The athletic apparel company posted break-even first-quarter adjusted earnings and revenue of $1.19 billion that topped analysts' forecasts, which called for a loss of 5 cents and revenue of $1.12 billion. The net loss in the period was 7 cents a share, wider than the year-earlier loss of 1 cent. The company recorded restructuring charges in the latest quarter of $37.5 million.
Under Armour said apparel sales in the quarter rose 7% on strength in men's training, while footwear sales rose 1%.
Cannacord Genuity analyst Camilo Lyon showed lack of faith in the company's turnaround efforts ahead of the earnings in a note on Monday, April 30.
"We see no reason to be constructive on UAA as the product creation/segmentation malaise has not improved, personnel issues/discord continue to surface, the competition landscape is intensifying, and valuation appears indefensible," he wrote. Cannacord reiterated its sell rating and gave the company a $9 price target.