Under Armour shares gain the most in 23 weeks on Tuesday, COO Patrik Frisk to succeed Kevin Plank as CEO

Under Armour Inc said on Tuesday that its Chief Operating Officer Patrik Frisk would succeed founder Kevin Plank as Chief Executive Officer, effective January 1st 2020. Frisk is to join Under Armour’s board, while Plank is to remain executive chairman and brand chief, the company also said.

Under Armour shares closed higher for a second consecutive trading session in New York on Tuesday. It has also been the sharpest daily surge since May 17th. The stock went up 6.42% ($1.29) to $21.38, after touching an intraday high at $21.45, or a price level not seen since September 13th ($21.88).

Shares of Under Armour Inc have risen 21.00% so far in 2019 compared with a 19.51% gain for the benchmark index, S&P 500 (SPX).

In 2018, Under Armour’s stock went up 22.45%, thus, it again outperformed the S&P 500, which registered a 6.24% loss.

Patrik Frisk became part of Under Armour’s team in July 2017. Previously, he served as Chief Executive Officer at Aldo Group and before that he was in various executive positions at VF Corp.

“Patrik is the right person to serve as Under Armour’s next CEO,” Kevin Plank said in the company’s press release, cited by CNBC.

“As my partner during the most transformative chapter in our history, he has been exceptional in his ability to translate our brand’s vision into world-class execution by focusing on our long-term strategy and re-engineering our ecosystem through a strategic operational and cultural transformation.”

Plank, 47, established the company in 1996, as he worked out of his grandmother’s basement during his college years. In 2005, the company was taken public.

Analyst stock price forecast and recommendation

According to CNN Money, the 24 analysts, offering 12-month forecasts regarding Under Armour Inc’s stock price, have a median target of $25.00, with a high estimate of $33.00 and a low estimate of $8.00. The median estimate represents a 16.93% upside compared to the closing price of $21.38 on October 22nd.

The same media also reported that at least 14 out of 29 surveyed investment analysts had rated Under Armour Inc’s stock as “Hold”, while 8 – as “Buy”. On the other hand, 3 analysts had recommended selling the stock.