UPDATE: D.A. Davidson & Co. Reiterates On Under Armour On Impressive Revenue Upside

In a report published Friday, D.A. Davidson & Co. analyst Andrew Burns reiterated a Neutral rating on Under Armour (NYSE: UA), and raised the price target from $58.00 to $72.00.

In the report, D.A. Davidson & Co. noted, “UA reported revenue and EPS of $609.7 million and $0.08, compared to consensus of $573.3 million and $0.07, and our estimates of $561.6 million and $0.07. By category, Apparel grew 35% year-over-year (y/y), Footwear grew 34%, and Accessories grew 18%. Direct-to-consumer (DTC) sales grew 38% and represented 31% of total sales. Gross margin expanded 88bp y/y to 49.2% driven by a favorable sales mix (+40bp due to a footwear liquidation shift to 3Q) and favorable product margins (+30bp). SG&A increased 41.6% y/y to $265.3 million, representing 43.5% as a percent of sales (vs. 41.2% in 2Q13), primarily reflecting the timing of marketing expenses and product innovation investment. Operating margin declined 142bp to 5.7%.”

Under Armour closed on Thursday at $69.55.