Under Armour Calls Timeout on Its Big NFL Deal

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On Sunday, as Americans tune into Super Bowl LV—Brady versus Mahomes—sportswear brand

Under Armour

will be leaving the field. The Financial Times reported recently that the company would end its on-field licensing deal with the National Football League, while contracts between individuals and Under Armour would be reevaluated before next season. Under Armour’s senior vice president of global sports marketing, Sean Eggert, confirmed that the contract wouldn’t be renewed. “We are in active conversations with the NFL to determine alternative opportunities that best serve athletes moving forward and to ensure the best [return on investment] for Under Armour,” he said in a statement.

The move is part of Under Armour’s restructuring, which began before the pandemic, and has meant exiting contracts with major college programs and Major League Baseball.

On Wall Street, that’s good news. Only a quarter of analysts are bullish on the shares, according to FactSet, yet recent results have increased confidence that the company is rebounding from pricey deals, accounting questions, and lackluster performance. Under Armour scored two upgrades in January, and its stock is up 18.4{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} to $17.74for the week and still down 1.3{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} for the year.

Jefferies’ Randal Konik reiterated a Buy rating this past week, while raising his price target by $2, to $25. He writes that while

Nike

continues to dominate in times when comfort and athleisure reign, its shares have gotten rich. In contrast, Under Armour benefits from the same factors, and is “well-positioned for global long-term growth,” as management works to improve inventory and distribution “and turn to the offensive.”

Next Week

Monday 2/8

Global Payments,

Hasbro,

KKR,

Loews,

Simon Property Group,

and Take-Two Interactive Software report quarterly results.

Tuesday 2/9

Carrier Global,

Centene,

Cisco Systems,

DuPont,

Fidelity National Information Services,

Fiserv,

Martin Marietta Materials,

S&P Global, and

Twitter

release earnings.

The National Federation of Independent Business releases its Small Business Optimism Index for January. Consensus estimate is for a 97reading, higher than December’s 95.9 figure. The December reading was the lowest since last May. “Small businesses are concerned about potential new economic policy in the new administration and the increased spread of Covid-19” according to NFIB chief economist Bill Dunkelberg.

The Bureau of Labor Statistics releases its Job Openings and Labor Turnover Survey for December. Expectations are for 6.6 million job openings on the last business day of December, compared with 6.5 million in November.

Wednesday 2/10

The Bureau of Labor Statistics releases the consumer price index for January. Economists forecast a 1.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} year-over-year rise for both the CPI and core CPI, which excludes volatile food and energy prices.

Cerner,

CME Group,

Coca-Cola,

Equinix,

General Motors,

MGM Resorts International,

O’Reilly Automotive,

and

Uber Technologies

announce quarterly results.

Federal Reserve Chairman Jerome Powell speaks via teleconference at the Economic Club of New York.

Philip Morris International

holds its 2021 virtual investor day.

Newmont, the world’s largest gold producer, hosts a conference call to discuss the exploration of new mines. The firm will also update investors on its reserves.

Thursday 2/11

AstraZeneca,

BorgWarner,

DaVita,

Duke Energy,

Expedia Group,

Illumina,

Kellogg, Kraft Heinz,

Laboratory Corp. of America Holdings,

Molson Coors Beverage,

PepsiCo,

Pool Corp.

,

Tyson Foods,

and Walt Disney report quarterly results.

PayPal Holdings

hosts its 2021 investor day.

The Department of Labor reports initial jobless claims for the week ending on Feb. 6. Jobless claims have averaged 835,000 a week in January, equal to December, and an increase of nearly 100,000 a week from November. Much of the increase stems from business closures resulting from the still-elevated level of Covid-19 cases.

Friday 2/12

Dominion Energy,

Enbridge, and Moody’s hold conference calls to discuss quarterly results.

The University of Michigan releases its Consumer Sentiment index for February. Consensus estimate is for a 79.5 reading, roughly even with the January data.

Write to Teresa Rivas at [email protected]