fbpx

Join our community of traders FOR FREE!

  • Learn
  • Improve yourself
  • Get Rewards
Learn More

Under Armour shares close lower on Monday, sportswear maker being probed by US regulators over accounting practices, WSJ reports

According to a report by the Wall Street Journal during the weekend, citing unidentified sources, US federal law enforcement officials are investigating Under Armour Inc (UAA) to determine if the company shifted sales from quarter to quarter in order to appear in better financial health.

Under Armour shares closed lower for the fifth time in the past eleven trading sessions in New York on Monday. It has also been the steepest daily loss this year. The stock went down 18.92% ($4.00) to $17.14, after touching an intraday low at $16.83, or a price level not seen since December 26th 2018 ($16.52).

Shares of Under Armour Inc have retreated 3.00% so far in 2019 compared with a 22.79% gain for the benchmark index, S&P 500 (SPX).

In 2018, Under Armour’s stock went up 22.45%, thus, it outperformed the S&P 500, which registered a 6.24% loss.

According to the WSJ report, Justice Department prosecutors are conducting a criminal inquiry and are also working in close coordination with civil investigators at the Securities and Exchange Commission.

“The company began responding in July 2017 to requests for documents and information relating primarily to its accounting practices and related disclosures, and the company firmly believes that its accounting practices and disclosures were appropriate,” a spokesperson for Under Armour said in an emailed statement, cited by Reuters.

In July, the athletic apparel maker revised down its full-year revenue forecast and also revealed expectations of a small revenue drop in North America.

Analyst stock price forecast and recommendation

According to CNN Money, the 23 analysts, offering 12-month forecasts regarding Under Armour Inc’s stock price, have a median target of $21.00, with a high estimate of $33.00 and a low estimate of $8.00. The median estimate represents a 22.52% upside compared to the closing price of $17.14 on November 4th.

The same media also reported that at least 14 out of 28 surveyed investment analysts had rated Under Armour Inc’s stock as “Hold”, while 7 – as “Buy”. On the other hand, 3 analysts had recommended selling the stock.

TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover Forex, Price Action and Social Trading.

Related News