Raymond James Says Under Armour is ‘Underrated Underdog’

According to a Raymond James, athletic apparel and shoe company Under Armour is an “underrated underdog.”

The firm has upgraded the stock to a “strong buy” rating and says the retailer is both “underrated” and an “underdog.”

According to Raymond James, a big rally could be in order as shares of the stock are trading in a bear market after tumbling 35% from their 52-week high back in July.

The firm says that Under Armour is on “the cusp of a multi-year, profitable, and sustainable growth cycle.”

It was earlier this month that the company resumed coverage on Under Armour, at which time it rated the stock “outperform.”

The company has cleaned up inventory in order to make room for new merchandise, which Raymond James says is selling “at higher levels” in the wholesale channel.

The improved merchandise position, and the innovation ahead, will make the transition to the new chief executive, Patrik Frisk, easier.

“This falls in line with our view for this event to largely be immaterial and unrelated to the fundamental story for an inflection in the business in spring 2020,” analysts at the firm wrote.

Raymond James has a $30 price target which represents a 67% upside to where the stock is currently trading.

Disclaimer: We have no position in Under Armour Inc Class (NYSE: UAA) and have not been compensated for this article.