UAA - Under Armour impresses Wells Fargo with strategic CEO hire

Wells Fargo said it was encouraged by the announcement by Under Armour ( NYSE: UAA ) ( NYSE: UA ) earlier in the week on the appointment of Stephanie Linnartz to be President, CEO, and member of the board. Linnartz will take over the position on February 27.

Analyst Kate Fitzsimons and team said they were most encouraged by Linnartz's experience in a founder-led organization and particularly her experience in digital, customer experience, as well as loyalty. All of those attributes were called transferrable to the Under Armour ( UAA ) organization.

For investors, Fitzsimons thinks a key overhang on the stock has been removed now that a strategic leader is being installed in the CEO role with a clear mandate to accelerate growth. Looking ahead, Fitzsimons said the firm is increasingly intrigued by the setup on UAA into 2023 with the additional potential catalyst of an investor day into next year and inventory investments into 2023 designed to reaccelerate the top line.

Wells Fargo kept an Overweight rating on Under Armour ( UAA ) into the new year. However. due to the macro backdrop, Wells Fargo lowered its price target on UAA to $14 from $20 as it applied a 12X multiple to the FY24 EBITDA estimate to account for multiple compression across the space. That PT still reps 44% upside for shares.

Shares of UAA rose 0.62% premarket to $9.73 vs. the 52-week trading range of $6.38 to $22.01.

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