Under Armour CEO Kevin Plank's turnaround effort may have hit a wall this year following the latest earnings report. Reports that he is selling personal assets, including his racehorse farm and his stake in an exclusive Baltimore hotel, have raised new concerns about Plank's financial health as UA continues to struggle. However, one UBS analyst sees light at the end of the tunnel, suggesting that sentiment around the athleisure brand could finally shift from negative to positive by 2027.
UA stock is down 34.5% year-to-date as of late Monday's cash trading session in New York. Shares are now trading at 2010 levels, marking a collapse from the 2015 peak and extending what has become a decade-long bear market.
However, not everyone believes UA is headed for delisting from the New York Stock Exchange or spiraling into insolvency.
UBS analyst Jay Sole told clients earlier on Monday:
We think sentiment will turn positive in FY27, driving stock outperformance:
We believe the Under Armour brand name remains an important asset, and we expect the company to better leverage it going forward than it has over the past few years. The presentations we saw at our 2nd annual Athletic Training & Lifestyle Innovation Day & 5K reinforce our conviction in this view. While tariffs will likely have a pronounced negative impact on sales and margins in FY26, we believe UAA is poised for a strong FY27 turnaround. As this inflection takes place, we expect sentiment around UAA to flip to positive from negative. This is why we continue to rate UAA Buy.
Sole outlined three key takeaways from his meeting with UA executives:
Bearish mood on Wall Street desks.
Then again, the turnaround plan could fail. Why doesn't the rest of Wall Street share Sole’s bullish outlook?
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