Under Armour Earnings: Fiscal Year on Track Despite Slow Domestic Wholesale; Shares Undervalued

We do not expect to make any material change to our $15.50 fair value estimate on Under Armour after it posted in-line fiscal 2024 (June-ended) first-quarter results and maintained its full-year guidance for revenue (flat to slightly up), gross margin (45.2%-45.7%), and EPS ($0.47-$0.51). We view its shares as very attractive at current levels. Although we see Under Armour as a no-moat company, we believe it has strengths, including its popularity in performance sports apparel, long-term agreement with Steph Curry, and solid balance sheet. While the U.S. wholesale channel is challenged by excess inventory and discounting across activewear, we anticipate conditions will normalize over the next few quarters.