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Pro Analysis

Even after plunge, Under Armour shares are overvalued, analyst says

Kevin Plank, CEO of Under Armour.
Adam Jeffery | CNBC
Kevin Plank, CEO of Under Armour.

Instinet lowered its rating on Under Armour to reduce from neutral, citing the risks of the company's high valuation given its slowing sales growth.

"UAA appears to have matured past its high-growth phase, while still enjoying its high-growth multiple," analyst Simeon Siegel wrote in a note to clients Monday. "However, even in an overly optimistic scenario … UAA 'the shares' are fairly valued at best and anything short of perfection could weigh on shares as slowing growth rates normalize the lofty multiple."

Under Armour shares are down more than 25 percent year to date through Friday, with most of the decline occurring after the company gave weaker-than-expected 2017 sales guidance in its fourth-quarter earnings report on Jan. 31.