(News Bulletin 247) – Wells Fargo announced on Friday that it had downgraded its recommendation on Under Armour, reduced from ‘overweight’ to ‘online weighting’ with a price target lowered from 12 to eight dollars.
According to the analyst, the title should remain prisoner of a ‘trading range’ limited over the next six to 12 months due in particular to its high exposure to US wholesalers.
He also explains that he prefers to stay away from the action until the new general manager of the sports equipment manufacturer can implement his strategy.
The intermediary also thinks that the company’s high level of inventories could put pressure on its margins, knowing that Nike also has substantial inventories, suggesting aggressive promotions.
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