New Under Armour product launches -- the Armour Bra and Spine running shoes -- should help boost the company's financial results in the second quarter and beyond, a report out today by analyst Sam Poser of Sterne Agee says.
Baltimore-based Under Armour, which will report second quarter earnings July 24, is also benefiting from strong demand for athletic apparel. That should lead to sales increases of 25 percent for apparel and 40 percent for footwear for the quarter that ended June 30, Poser's report says. The analyst is reiterating a buy rating on Under Armour stock.
Poser said women's sports apparel should offer a big opportunity for Under Armour, especially as the company has focused recently on improving fit and attractiveness.
"The Armour Bra which was introduced in 1Q at $58 has been very successful," Poser wrote. "We are also hearing positive commentary from retailers on the women's charged cotton and the Studio Line."
As for distribution of women's apparel, "we have long held the view that women's athletic apparel is best sold in female-friendly channels such as Nordstrom...and Lady FL, rather than Dicks Sporting Goods...or the Sports Authority."
In recent months Under Armour has increased its presence in Nordstrom. And Foot Locker is planning to expand its Under Armour business over the next few years, the report said.
Under Armour will likely boost sales by 26 percent this year, Poser said, partly because of the introduction of the Spine training shoe, billed as lightweight and structured for support and weighing less than 10 ounces.
"There's nothing like this out there," Dave Dombrow, Under Armour's creative director for footwear, says in a video on the company's website introducing the Spine technology.
Dombrow says company designers looked at bat's wings and helicopters' flight for inspiration, but ultimately attempted to create a shoe inspired by the flexibility and rigid segments of the human spine.
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