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3 retailers investors hate more than Under Armour

Aug 1, 2017, 23:11 IST

Reuters

Under Armour's shares have been hammered harder than almost any other retail company this year.

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The company's stock price took a beating Tuesday, falling more than 8%, after it cut full-year sales guidance and reported continuing weakness in North America, its most important market.

Since the beginning of the year, Under Armour's shares have dropped more than 33%, making it the ninth worst-performing stock in the S&P 500 this year.

Under Armour's fall from glory has been swift and brutal. It was only two years ago that the company was touted as a top investment pick after notching 26 straight quarters of at least 20% sales growth. Shares grew nearly 20% that year.

Despite its recent troubles, however, Under Armour has still outperformed a few other retailers in the S&P 500.

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Foot Locker, Macy's, and Signet Jewelers - which operates Kay Jewelers, Zales, Jared The Galleria Of Jewelry, and other jewelry stores - have all seen their share prices drop even further than Under Armour's.

Foot Locker and Macy's shares have dropped 34% in 2017 and Signet Jewelers shares have dropped 35%.

Foot Locker has been suffering from a shift in shoe manufacturers' preferences toward selling to online-only channels over brick-and-mortar stores, according to Credit Suisse.

"Ultimately, we believe the best-in-class execution by Foot Locker may no longer be enough to offset two-fronts of structural industry change," Credit Suisse analysts wrote in a recent note.

Macy's and Signet Jewelers are both under intense pressure from years of falling traffic to malls, where their stores are primarily located.

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Macy's is also reeling from consumers' growing demand for off-price products, which are less profitable to sell.

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