Under Armour Stock Sends Up Bull Signal After Bear Note

Under Armour is finding familiar support at its 320-day trendline

by Karee Venema

Published on Dec 19, 2018 at 9:46 AM

J.P. Morgan Securities cut its price target on Under Armour Inc (NYSE:UAA) to $21 from $25, though this is still an 11.6% premium to last night's close. In reaction, UAA stock is down 1.2% to trade at $18.58, but finding support near its 320-day moving average, which served as a floor in late October, too.

The pullback to this trendline could signal a short-term rally for Under Armour shares. According to data from Schaeffer's Senior Quantitative Analyst Rocky White, the stock's previous retreat to this trendline resulted in a one-month gain of 25.9%, and culminated in a record high of $24.96 earlier this month. This would just echo UAA's long-term performance this year, with the shares up 29% so far.

Options traders have been buying to open puts over calls at a quicker-than-usual clip in recent weeks. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), UAA's 10-day put/call volume ratio of 1.40 ranks in the 81st annual percentile.

This skepticism is seen outside of the options pits, too, with 19 of 24 covering analysts maintaining a "hold" or worse rating on Under Armour stock. Plus, the average 12-month price target of $20.96 is a tame 12% premium to current trading levels. Should UAA take another sharp bounce from its 320-day trendline, a capitulation from some of the weaker bearish hands could fuel the stock's fire.


a schaeffer's exclusive

PLAY TRENDS LIKE A PRO!

5 tips to leverage profits in this FREE insider report!


 
 

Partnercenter


NEW! Explore Schaeffer’s Partners' deals and get connected to top online brokerages with deals tailored exclusively for our readers.  Get answers to your questions regarding transfer fees, commission rates, programs and available discounts related to online trading services.

MORE | MARKETstories


The IRS Loopholes Retirees Need to Know
Click to continue to advertiser's site.
Another Week of Fresh Highs Amid U.S.-China Trade Developments, Earnings
Developments on a trade deal between the U.S. and China were closely followed this week
Call Traders Blast These 2 Surging Stocks
Both stocks are enjoying record weeks
The IRS Loopholes Retirees Need to Know
Click to continue to advertiser's site.