What happened

The S&P 500 index eked out a small win on the first trading day of the week -- but Under Armour (NYSE:UAA) (NYSE:UA) shareholders weren't so lucky. By close of trading, "A" shares of the sportswear maker's stock dropped nearly 7% in early trading, closing the day down 6.5%, while "C" shares of the stock did only a little bit better, falling 5.5% initially before closing the day down 4.7%.

You can thank J.P. Morgan for all of that.

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Image source: Getty Images.

So what

On Monday, J.P. Morgan resumed coverage of Under Armour stock at a level lower than its last-reported opinion -- in essence, downgrading Under Armour from "overweight" to "neutral."

"We see the cadence of North America revenue second-half weighted," warned the analyst -- an indication that first-half sales will not be great. "Wholesale and new full-price store openings" will show "sequential improvement," but not enough improvement to offset sales lost from reduced sales of discounted merchandise.

Now what

As a result, the analyst forecasts only 3.8% sales growth for the full fiscal year 2020, nearly a full percentage point -- or $240 million -- below the growth forecast by most other analysts. Whereas most analysts are forecasting $5.54 billion for Under Armour's sales this year, J.P. Morgan thinks $5.3 billion is a more likely number.  

The good news? Even with this lower-than-expected growth for Under Armour, J.P. Morgan thinks its shares are worth about $23. Now that the stock has sunk below that price as a result of the analyst's downgrade, it may be worth thinking about buying Under Armour again.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.