Under Armour Faces More Troubles Than COVID-19
Last month, Under Armour (NYSE: UA) (NYSE: UAA) reported weak first-quarter results, with GAAP revenue falling by 23% year over year from $1.2 billion to $930.2 million. While it would be tempting to blame the entire decline on COVID-19, management attributed only about two-thirds of the decline to the pandemic. While the coronavirus shutdowns and disruptions had a major impact, and Under Armour expected the impact of a reduction in sales through its off-price channel, revenue growth remained elusive.
Clearly, there is more going on with the company. In fact, it has deeper, longer-standing issues that have caused both classes of shares to slump about 75% from levels seen five years ago, even after a rally earlier this month that was driven by the gradual reopening of the economy and a better-than-expected May jobs report.
This makes it a good time to delve into Under Armour's issues and attempt to determine if the stock's recent upward swing has staying power.
Source Fool.com
