Under Armour (UA, UAA) faces uncertain sales recovery, with limited near-term visibility on a meaningful turnaround in North America demand and continued pressure on revenue trends, BofA Securities said in a note Wednesday.

Management's fiscal 2027 outlook assumes a stabilization year, with North America sales still declining in the low-single digits following a sharper drop in fiscal 2026, while overall guidance reflects a wide range of outcomes, according to the note.

BofA said that while adjusted operating income is expected to rise about 40% year over year at the midpoint, most of the improvement is driven by one-off tariff refunds, with underlying margin expansion more limited once those effects are excluded.

Analysts also highlighted ongoing SKU reductions, improved product focus, and lower discounting, but said there is still limited evidence these steps will drive a sustained demand recovery. The investment firm lowered its fiscal 2027 and 2028 earnings per share estimates by 58% and 46% to $0.10 and $0.17, respectively.

BofA maintained its neutral rating on the stock and lowered its price target to $6.40 from $8.

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