Mixed Corporate Earnings Pressure Markets Lower: Latest Report on Under Armour and United Parcel Service

NEW YORK, NY / ACCESSWIRE / February 1, 2017 / Mixed corporate earnings and uncertainties of how President Trump’s recent travel ban would affect the markets pressured major indexes lower Tuesday. Despite the decline, all three major indexes posted a monthly gain for January, which was the first since 2013. The Dow Jones Industrial Average fell 0.54 percent to close at 19,864.09, up 0.51 percent for the month, while the S&P 500 and the NASDAQ posted monthly gains of 1.79 percent and 4.3 percent, respectively.

“Investors definitely need to be aware that the markets behaved very suddenly towards pricing in heavy premiums following the US election outcome based on fiscal promises, but so far it is the far-right agenda that we have seen the most movement on from the Trump administration,” Jameel Ahmad, vice president of research at FXTM, said in a note.

Under Armour Inc. (NYSE: UA)

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Under Armour’s shares dropped 23.40 percent to close at $19.22 a share Tuesday. The stock traded between $18.52 and $20.08 on volume of 57.00 million shares traded. The company reported revenues of $1.308 billion for the fourth quarter of 2016, an increase of 11.7 percent when compared to revenues of $1.171 billion in the same quarter a year ago, resulting in slowest revenue growth for the company in the last 8 years. Net income was $104.9 million for the fourth quarter of 2016, down from $105.6 million a year ago.

Reported growth in revenue is also in stark contrast to its CEO Kevin Plank’s comments in October, when he said the company’s annual revenue would grow in the low 20 percent range in 2017 and 2018. Under Armour forecasts sales to be approximately $5.4 billion in 2017, which fell short of average analysts’ estimates of $6.05 billion, according to Bloomberg.

United Parcel Service, Inc. (NYSE: UPS)

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United Parcel Service’s shares fell 6.75 percent to close at $109.13 a share Tuesday. The stock traded between $108.68 and $111.81 on volume of 12.76 million shares traded. The company reported adjusted earnings per share of $1.63 for the fourth quarter of 2016. Revenues for the quarter totaled $16.93 billion, an increase of 5.5 percent when compared to revenues of $16.05 billion in the fourth quarter of 2015. Consensus analysts’ estimates had called for adjusted earnings per share of $1.69 and revenues of $17.00 billion.

“The investments in ORION and automation provided benefits during the quarter,” said Richard Peretz, UPS Chief Financial Officer. “However, bottom-line results were challenged by a shift in product mix and the continued softness in industrial production. Strong growth, combined with our network investments, provide UPS with great opportunities for many years to come.”

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