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Sporting apparel maker Under Armour has bounced off multi year lows to 52 week highs. The move is on the back of Lululemon hitting all time highs and the hope that the Dwayne “The Rock” Johnson Project Rock 1 shoe success is signals a rebound in $UAA fortunes.

under armour project rock 1

 The Heel of Project Rock 1 Shoe

The Rock’s Under Amour Project Rock 1 shoes were released on May 28 in limited quantities through the company’s online store and in Brand Houses across the country over Memorail Day with a red, white and blue color scheme in honor of America’s service men and women, .

The whole inventory sold out in 30 minutes.

“We like to think of Dwayne as our motivator of the masses,” said Adrienne Lofton, senior vice president of global brand management at Under Armour.

The shoes were priced at $120, with features like heel support for stability while lifting weights, as well as a top knit for a snug fit around the ankle and foot. Under Armour will restock the shoes on June 28, which will be the global launch. Further details are yet to be announced. The Rock has been in partnership with $UAA since 2016 with the first joint projects a backpack and duffel bag.

Under Armour Daily 6 7 18

$UAA 52 week High but plenty of room above

In addition to The Rock’s new shoe, Under Armour also introduced a new Steph Curry basketball shoe on Pi Day, March 14. The latest version was priced at $130 and sold out online. Curry's team Golden State Warriors is up 3-0 in the NBA world championships so a further flow on affect is seen there.

Outside of Lululemon apparel retailers have been burdened by high inventory levels which puts pressure on margins. The popularity of the Project Rock 1 could be a sign of improvements a number of analysts haave said, though sceptics see the analysts searching for a trade after missing $LULU.

Instinet Analysts noted “We believe that the limited availability (and subsequent restocking) is part of the company’s plan for managing the franchise to generate buzz and promote a ‘call to action’ and represents a positive for brand equity,”

Stifel analysts said “We are particularly encouraged by opportunities for gross margin improvement from both elimination of the liquidation burden and improved sourcing (SKU [stock keeping unit] rationalization, materials planning, factory consolidation, capacity planning, etc.),” Stifel raised their price target $UAA shares to $27 from $20 and rates Under Armour shares a buy. 

Source: Under Armour

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