Under Armour (UAA): Assessing Valuation Following This Week’s Share Price Rebound

Under Armour (UAA) shares moved higher today, building on a recent bounce that has drawn attention from investors tracking the brand's performance. Over the past week, the stock climbed 6%, a move that stands out following a weaker month.

See our latest analysis for Under Armour.

Looking back over the past year, Under Armour's share price has moved sharply lower even as it takes a short-term bounce, with a 1-year total shareholder return of -53.6% and the latest closing price at $4.50. Momentum appears tentative, which suggests investors are still weighing the company’s recovery prospects after significant declines earlier in the year.

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The recent rally has sparked a familiar debate among investors, raising the question of whether Under Armour shares are trading at a discount or if the market has already accounted for any potential turnaround. Could there still be a genuine buying opportunity here, or is future growth fully priced in?

Most Popular Narrative: 22.8% Undervalued

Under Armour’s fair value is estimated at $5.83, a notable premium compared to the latest closing price of $4.50. Anticipated improvements in revenue growth and margins are driving up sentiment, but the narrative reveals the catalysts behind this valuation jump.

The ongoing transformation to a brand-first strategy, with a focus on premiumization, tighter SKU assortments, and greater brand storytelling, positions Under Armour to increase average selling prices, improve full-price sell-through, and reduce reliance on discounting. This should positively impact net margins and long-term earnings growth.

Read the complete narrative.

Wondering what’s fueling such an optimistic story amid a battered chart? There is a potent mix of projected profit acceleration, ambitious revenue goals, and expectations for a rebound to higher earnings multiples priced in. Find out exactly what assumptions make this target possible. Some numbers may surprise you.

Result: Fair Value of $5.83 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent margin pressure from tariffs, as well as ongoing consumer demand softness, could quickly challenge optimism and threaten recovery for Under Armour’s turnaround.

Find out about the key risks to this Under Armour narrative.

Another View: Discounted Cash Flow Model Paints a Different Picture

While analysts see Under Armour as undervalued compared to fair value and peers, the Simply Wall St DCF model presents a less optimistic perspective. According to our DCF calculation, the stock is trading well above what the model estimates as its fair value. This suggests there may be less upside than headline multiples indicate. Could the market be missing hidden risks, or is sentiment undervaluing long-term recovery?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Under Armour for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 932 undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Under Armour Narrative

If you see things differently or want to dive into the numbers on your own terms, you can quickly build your own story in minutes, your way with Do it your way

A great starting point for your Under Armour research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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