Under Armour (UA) has been one of the better retail plays in a group that is gasping for air. There are very deep concerns around consumer spending trends, but for those companies with the right combination of quality merchandise, style, pricing and consumer focus, well, things are looking pretty good. Despite its competition, Under Armour has seen its shares rise significantly lately, and I believe it will rise to the top in the coming months (I’ll be writing a longer article on this subject later this week).
As you can see in the chart below, the technicals have been strong since the stock bottomed out in May. In fact, it’s been on a tear, rising nearly 60% off that low. The indicators have been bullish, and with a huge gap/hold on earnings in July, Under Armour looks ready to move up again. Volume has been decent, but option flow has been outstanding, too. The %R indicator is the key here, and each bull retest (see the arrows) have shown us great buying chances. On September 2, the volume was solid. We bought some Oct 70 calls recently.
