Founder Comeback Pressures Under Armour Stock

Kevin Plank will return as Under Armour’s CEO on April 1, but UAA is lower in response

Under Armour Inc (NYSE: UAA) stock was last seen down 12% to trade at $7.12, following news that founder Kevin Plank will return as CEO on April 1 to replace Stephanie Linnartz. Plank has been serving as the apparel retailer’s executive chair and brand chief since 2020.

Today’s bear gap is pacing to be the stock’s worst single-session drawdown since a May 2022 post-earnings selloff of 23.8%. The shares are trading at their lowest level since mid November, and now sport an 19% year-to-date deficit.

Drilling down to today’s options activity, 3,597 calls and 8,734 puts have crossed the tape, which is whopping 30 times the volume that is typically seen at this point. The most popular is the September 7.50 put, followed by the March 7.50 call, with new positions being bought to open at the latter.

This penchant for puts is unusual, given Under Armour stock’s 10-day call/put volume ratio of 12.72 sits higher than 94% of annual readings back at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX).

Now may be an ideal time to weigh in on the equity’s next move with options, per its Schaeffer’s Volatility Index (SVI) of 43% that ranks in the low 15th percentile of readings from the last 12 months, indicating traders are now pricing in low volatility expectations.

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