Stifel analyst Jim Duffy lowered the firm’s price target on Under Armour (UAA) to $9 from $10 and keeps a Buy rating on the shares after the company announced a $434M legal settlement relating to the 2017 allegations around misrepresentation of consumer demand for the brand. The “disappointing outcome comes as a surprise,” and the amount is greater than anticipated even in an unfavorable outcome, the analyst tells investors in a research note. Stifel says the settlement is a “negative shock” to Under Armour’s balance sheet, and moves the company to a net debt position from a previous net cash position, restricting financial flexibility.
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