Why Under Armour, Inc. Could Be Poised for Higher Highs

Outperforming Under Armour Inc (UA) is surprisingly surrounded by pessimism

Dec 31, 2014 at 9:40 AM
facebook twitter linkedin


Under Armour Inc (NYSE:UA), which was recently named the Yahoo Finance 2014 "Company of the Year," has been a technical beast. Year-to-date, shares of the athletic apparel maker have gained 57.1% to land at $68.53. However, not everyone has joined the stock's bullish bandwagon.

Daily Chart of UA since January 2014

The one place where optimism is evident is in UA's options pits. During the last two weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity has accumulated a call/put volume ratio of 2.08 -- with traders buying to open more than two calls for every put. Furthermore, this ratio ranks in the bullishly skewed 67th percentile of its annual range.

Short sellers, however, aren't sold on UA. In fact, 6.8% of the stock's float is sold short, which would take roughly seven sessions to buy back, at average daily trading volumes. This potentially paves the way for a short-covering rally, assuming the shares can sustain their long-term trek higher.

Likewise, nearly half of the analysts covering Under Armour Inc (NYSE:UA) rate it a "hold" or "sell." Plus, the security's average 12-month price target of $72.43 stands at a slim premium to its current perch. This leaves the door wide open for a round of upgrades and/or price-target hikes to usher in a fresh wave of buying power.

 

Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

 
Schaeffer's Daily Bulletin Offer
 


 


 
Special Offers from Schaeffer's Trading Partners