What Happened?
Shares of athletic apparel company Under Armour (NYSE: UAA) jumped 3.1% in the morning session after a broader positive sentiment for the retail sector's increasing adoption of Artificial Intelligence (AI).
A new survey from Monday.com highlighted that Under Armour is among many retailers prioritizing AI investments. The report, which surveyed over 1,800 retail leaders, found that despite reliability concerns, the industry is confident in the technology's long-term potential. This sentiment is underscored by the finding that nearly two-thirds of retail leaders believe businesses that fail to adopt AI in the next two years risk falling behind. Additionally, more than half of retailers expect AI to handle the majority of customer interactions within five years, signaling a significant operational shift that could benefit early adopters.
After the initial pop the shares cooled down to $5.05, up 1.3% from previous close.
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What Is The Market Telling Us
Under Armour’s shares are very volatile and have had 23 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 6 days ago when the stock dropped 3.3% on the news that markets continued to decline, as investors grew cautious ahead of a key speech by Federal Reserve Chair Jerome Powell. The move came as U.S. equity markets recorded a fifth consecutive day of losses for major indexes like the S&P 500, with technology stocks experiencing the largest declines. Investors have grown wary that the sharp rally in the tech sector since April may have advanced too far. The market-wide caution is largely driven by the upcoming Jackson Hole symposium, a meeting of central bankers, where traders are anxiously awaiting Fed Chair Powell's speech on Friday for guidance on the future path of interest rates.
Under Armour is down 37.7% since the beginning of the year, and at $5.05 per share, it is trading 54.7% below its 52-week high of $11.13 from November 2024. Investors who bought $1,000 worth of Under Armour’s shares 5 years ago would now be looking at an investment worth $508.57.
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