I've been looking at Under Armour (UAA) for a while. The company used to be a high-growth stock and was second only to Nike (NKE). With its rival sports-apparel companies stock prices rallying in recent weeks, I wanted to do due diligence on the company. Under Armour's stock hasn't moved much from all-time lows and unfortunately, at these prices I think the stock is still overvalued.

In terms of short-term results, revenue was down 41% year over year to $708 million. Wholesale revenue decreased 58% to $299 million while direct-to-consumer revenue was down 13% to $368 million. Revenue declined across the board in apparel, footwear, and accessories (down 42%, 35%, and 47%).

The company blamed the ongoing coronavirus pandemic for the massive decline in sales. The main industry giant Nike also suffered a 38% decrease in revenue within the same period. Putting that into perspective, the company’s revenue decline wasn’t too bad. However, moving forward, the company has warned of excessive inventory levels from all retails and the potential for necessary discounting to hurt results in the short term.

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