We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Under Armour (UAA) Q2 Earnings Top, Revenues Down Y/Y
Read MoreHide Full Article
Under Armour, Inc. (UAA - Free Report) delivered better-than-expected earnings in second-quarter fiscal 2024, wherein the metric also increased year over year. Management also revised the guidance for fiscal 2024.
The company reported earnings of 24 cents a share, which beat the Zacks Consensus Estimate of earnings of 21 cents per share. The company recorded earnings of 19 cents a share in the year-ago period.
Meanwhile, net revenues of $1,566.7 million came almost in line with the consensus estimate of $1,566 million but fell 0.5% on a year-over-year basis. The metric also slipped 1% on a currency-neutral basis.
The company’s wholesale revenues dipped 1% year over year to $940 million, while direct-to-consumer (DTC) revenues inched up 3% to $596 million due to a 2% rise in e-commerce revenues, which represented 35% of the total DTC business. Growth in the e-commerce and retail channels aided the performance. The company recorded 4% growth in owned and operated store revenues.
Let’s Delve Deeper
By product category, Apparel revenues edged up 3.1% year over year to $1,070.4 million, while Footwear revenues dipped 6.6% to $351.2 million. Revenues from the Accessories category inched up 2.5% to $113.9 million. Meanwhile, Licensing revenues tumbled 13.5% to $28.6 million.
Net revenues from North America decreased 2% to $991.4 million. Meanwhile, revenues from the international business increased 5% (up 3% on a currency-neutral basis) to $573 million.
Within the international business, net revenues in EMEA jumped 9% to $287.1 million (up 4% at constant currency), 3% in Asia-Pacific to $232.1 million (up 7% at constant currency) but fell 8% in Latin America to $53.7 million (down 19% at constant currency).
The company’s gross margin expanded 260 basis points to 48% from the prior-year period owing to gains from the supply chain with respect to reduced freight expenses, partly offset by a channel mix impact associated with the normalization of off-price sales. Selling, general and administrative (SG&A) expenses rose 2% to $606 million.
The company’s operating income increased to $145.8 million from $119.4 million. The operating margin was 9.3%, up from 7.6% in the year-earlier quarter.
Other Financial Details
Under Armour ended the quarter with cash and cash equivalents of nearly $655.9 million, long-term debt (net of current maturities) of $594.7 million and total stockholders' equity of $2,089.7 million. The inventory jumped 6% to $1.1 billion.
FY24 Guidance
Management revised the view for fiscal 2024. For the current fiscal year, Under Armour expects revenues to decline 2-4% versus the earlier view of flat to slightly up. It expects the gross margin to be up 100-125 basis points from the prior year's margin of 44.9% compared with 25-75 basis points projected previously. SG&A expenses are anticipated to be flat to slightly down, versus the previous view of flat to slightly up.
Under Armour continues to expect the operating income to be between $310 million and $330 million versus the comparable baseline period’s operating income of $284 million.
UAA still envisions earnings to be in the band of 47-51 cents per share, down from 84 cents per share reported in fiscal 2023. The company reported adjusted earnings of 58 cents a share for the comparable baseline period. Capital expenditures are likely to come in the band of $230-$250 million.
This Zacks Rank #4 (Sell) company’s stock has fallen 4.5% in the past three months compared with the industry’s 1.4% drop.
GIII has a trailing four-quarter earnings surprise of 526.6%, on average. The Zacks Consensus Estimate for GIII’s 2023 sales and earnings per share (EPS) indicates increases of 2.4% and 14.7%, respectively, from the year-ago period’s reported levels.
lululemon athletica is a yoga-inspired athletic apparel company. LULU carries a Zacks Rank #2 (Buy), at present.
The Zacks Consensus Estimate for lululemon athletica’s current financial-year sales and EPS suggests growth of 18.1% and 20.5%, respectively, from the year-ago corresponding figures. LULU has a trailing four-quarter earnings surprise of 6.8%, on average.
Ralph Lauren, a footwear and accessories dealer, has a Zacks Rank of 2 at present. RL has a trailing four-quarter earnings surprise of 17.3%, on average.
The Zacks Consensus Estimate for Ralph Lauren’s current financial-year sales and EPS suggests growth of 2.4% and 13.4%, respectively, from the year-ago corresponding figures.
See More Zacks Research for These Tickers
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Under Armour (UAA) Q2 Earnings Top, Revenues Down Y/Y
Under Armour, Inc. (UAA - Free Report) delivered better-than-expected earnings in second-quarter fiscal 2024, wherein the metric also increased year over year. Management also revised the guidance for fiscal 2024.
The company reported earnings of 24 cents a share, which beat the Zacks Consensus Estimate of earnings of 21 cents per share. The company recorded earnings of 19 cents a share in the year-ago period.
Meanwhile, net revenues of $1,566.7 million came almost in line with the consensus estimate of $1,566 million but fell 0.5% on a year-over-year basis. The metric also slipped 1% on a currency-neutral basis.
The company’s wholesale revenues dipped 1% year over year to $940 million, while direct-to-consumer (DTC) revenues inched up 3% to $596 million due to a 2% rise in e-commerce revenues, which represented 35% of the total DTC business. Growth in the e-commerce and retail channels aided the performance. The company recorded 4% growth in owned and operated store revenues.
Let’s Delve Deeper
By product category, Apparel revenues edged up 3.1% year over year to $1,070.4 million, while Footwear revenues dipped 6.6% to $351.2 million. Revenues from the Accessories category inched up 2.5% to $113.9 million. Meanwhile, Licensing revenues tumbled 13.5% to $28.6 million.
Net revenues from North America decreased 2% to $991.4 million. Meanwhile, revenues from the international business increased 5% (up 3% on a currency-neutral basis) to $573 million.
Within the international business, net revenues in EMEA jumped 9% to $287.1 million (up 4% at constant currency), 3% in Asia-Pacific to $232.1 million (up 7% at constant currency) but fell 8% in Latin America to $53.7 million (down 19% at constant currency).
The company’s gross margin expanded 260 basis points to 48% from the prior-year period owing to gains from the supply chain with respect to reduced freight expenses, partly offset by a channel mix impact associated with the normalization of off-price sales. Selling, general and administrative (SG&A) expenses rose 2% to $606 million.
The company’s operating income increased to $145.8 million from $119.4 million. The operating margin was 9.3%, up from 7.6% in the year-earlier quarter.
Other Financial Details
Under Armour ended the quarter with cash and cash equivalents of nearly $655.9 million, long-term debt (net of current maturities) of $594.7 million and total stockholders' equity of $2,089.7 million. The inventory jumped 6% to $1.1 billion.
FY24 Guidance
Management revised the view for fiscal 2024. For the current fiscal year, Under Armour expects revenues to decline 2-4% versus the earlier view of flat to slightly up. It expects the gross margin to be up 100-125 basis points from the prior year's margin of 44.9% compared with 25-75 basis points projected previously. SG&A expenses are anticipated to be flat to slightly down, versus the previous view of flat to slightly up.
Under Armour continues to expect the operating income to be between $310 million and $330 million versus the comparable baseline period’s operating income of $284 million.
UAA still envisions earnings to be in the band of 47-51 cents per share, down from 84 cents per share reported in fiscal 2023. The company reported adjusted earnings of 58 cents a share for the comparable baseline period. Capital expenditures are likely to come in the band of $230-$250 million.
This Zacks Rank #4 (Sell) company’s stock has fallen 4.5% in the past three months compared with the industry’s 1.4% drop.
Eye These Solid Picks
Some better-ranked companies are G-III Apparel Group (GIII - Free Report) , lululemon athletica (LULU - Free Report) and Ralph Lauren (RL - Free Report) .
G-III Apparel sports a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
GIII has a trailing four-quarter earnings surprise of 526.6%, on average. The Zacks Consensus Estimate for GIII’s 2023 sales and earnings per share (EPS) indicates increases of 2.4% and 14.7%, respectively, from the year-ago period’s reported levels.
lululemon athletica is a yoga-inspired athletic apparel company. LULU carries a Zacks Rank #2 (Buy), at present.
The Zacks Consensus Estimate for lululemon athletica’s current financial-year sales and EPS suggests growth of 18.1% and 20.5%, respectively, from the year-ago corresponding figures. LULU has a trailing four-quarter earnings surprise of 6.8%, on average.
Ralph Lauren, a footwear and accessories dealer, has a Zacks Rank of 2 at present. RL has a trailing four-quarter earnings surprise of 17.3%, on average.
The Zacks Consensus Estimate for Ralph Lauren’s current financial-year sales and EPS suggests growth of 2.4% and 13.4%, respectively, from the year-ago corresponding figures.