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Under Armour In The Midst Of An NBA Finals Rally

Courtesy of Benzinga.

Under Armour In The Midst Of An NBA Finals Rally

Who says what happens in the mass media on a day-to-day basis doesn’t impact individual stocks? Look no further than the recent rally in shares of Under Armour Inc (NYSE: UAA).

Keep in mind, the stock is a casualty on the prolonged retail route, and as of late, there has been rotation out of some high-beta stocks and into beaten-down stocks perceived to have long-term value. Many shorts are also sitting on some huge profits in the sector, so eventually, some may want to cover and deploy their profits elsewhere.

Dub Nation

However, in the case of Under Armour, the recent rally just happens to coincide with the start of the NBA Finals, which pits the Golden State Warriors against the Cleveland Cavaliers. Although Kevin Durant of Golden State and Lebron James of Cleveland are sponsored by Nike Inc (NYSE: NKE) — which has added $2.00 per share since the start of the Finals — Steph Curry’s endorsement deal with Under Armour has helped substantially increase footwear sales over the last few years and promote overall brand awareness.

How often do stocks rally for eight consecutive days in these volatile markets and, more specifically, how does a stock that has been in such a prolonged decline muster an eight-day rally?

Finding A Catalyst

In this instance, the NBA Finals began on June 1. In its previous session, Under Armour’s stock closed at $17.93.

The session after Game 1, it added 56 cents to close at $18.39. By the time the series shifted to Cleveland, it had climbed to $18.97.

After Game 3, it added $0.24. During the off day, it added $0.40 and got a $0.61 boost to $20.21 the day Cleveland won Game 4.

Since the start of the NBA Finals, Under Armour has added $3.47, or 20 percent, to $21.30 — one of its best runs in quite some time.

Ahead of what could be one of the most-watched NBA Finals game ever, Under Armour has added $1.21 to trade at $23.10 as of 3:20 p.m. ET. It’s trading at its highest level since it was torched on January 31 ($25.09 to $19.22) when it missed for EPS and revenues for the first time in 19 quarters.

Will Golden State end the series and end the rally? Or can the Cavaliers send the series back to Cleveland for Game 6 on Thursday? If so, the eight-day rally in Under Armour could continue a bit longer.

Related Links:

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Posted-In: News Technicals Previews Sports Events Intraday Update Movers Trading Ideas Best of Benzinga

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