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Shares of the company jumped 10.5% after the athletic wear maker said it expected 2021 revenue in North America, a major market, to growth in high twenties.
Athletic apparel makers, including Nike (NYSE:NKE) and Adidas AG (DE:ADSGN), have booked outsized sales benefits from people shunning dressier apparel for joggers, hoodies and other smart casuals that catered to their needs for workout wear as well as comfortable day outfits.
Analysts believe the athletic wear boom could last at least through next year, even as schools and offices reopen.
Under Armour (NYSE:UA)’s forecast raise comes at a time when months-long factory closures in Vietnam, where it sources about one-third of all its products from, have raised doubts about the availability of its products during the all-important holiday season and beyond.
It forecast 2021 adjusted earnings per share to reach about 74 cents, compared with its prior range of 50 cents to 52 cents. Analysts on average expect profit per share of 55 cents, according to Refinitiv IBES.
It expects 2021 revenue to increase about 25% versus its previous forecast in low twenties, and compared with analysts’ average estimate of a 22.7% rise.
The clothing brand has also been spending more on marketing for new launches, including women’s SmartForm bra and new Hovr shoe models. It recently launched videos with athletes Chase Young, Trent Alexander-Arnold and Ty Harris wearing its apparel.
Net revenue increased 8% to $1.55 billion in the third quarter ended Sept. 30, beating estimates of $1.48 billion.
On an adjusted basis, the company earned 31 cents per share, above estimates of 15 cents.
