After outperforming estimates for most of last year, high-tech sportswear weaver Under Armour (NYSE: UA) takes up the baton and begins a new lap tomorrow, when it reports Q1 2008 earnings. Will it race ahead or lag the pack? With our Foolish Forecasts, we've got your back. (Here ends my contribution to National Poetry Month.)

What analysts say:

  • Buy, sell, or waffle? Fourteen analysts follow Under Armour, down three from last quarter. A lucky number seven of them rate the stock a buy, six more a hold, and one says "sell."
  • Revenue. On average, the analysts expect to see sales rise 24% to $153.6 million.
  • Earnings. But profits are predicted to plunge 85% to just $0.03 per share.

What management says:
Under Armour may have trounced the skeptics last year, but on Wall Street, it's always: "What have you done for me lately?" Thus, the reaction to this quarter's news will likely depend in large part on how Under Armour updates last quarter's promise to outperform the company's long-term growth targets in 2008.

As you know, UA has a long-term goal of posting top- and bottom-line growth ranging from 20% to 25%. This year, "the Company believes 2008 net revenues and income from operations will exceed the long-term targets," with revenues hitting close to $770 million, and income from operations closing at about $109.5 million (27% year-over-year growth in each metric). A full-blown marketing campaign in the first half of the year means, however, that UA expects to report no more than a nickel-a-share in total profits in Q1 and Q2 combined.

What management does:
Thus, we're being asked to have an awful lot of faith in the company this year. But has UA rewarded such faith in the past? Let's see ...

Margins

9/06

12/06

3/07

6/07

9/07

12/07

Gross

49.6%

50.1%

49.6%

49.8%

49.8%

50.3%

Operating

13.6%

13.2%

12.7%

12.7%

13.4%

14.2%

Net

8.9%

9.1%

8.6%

8.6%

8.4%

8.7%

All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ended in the named months.

One Fool says:
Rolling gross margins renewed their growth last quarter, as did net margins, and UA's operating margin has been on the upswing for more than six months now. UA has overtaken Nike (NYSE: NKE) in the operating margins race, leaving footwear specialists K-Swiss (Nasdaq: KSWS), Skechers (NYSE: SKX), Timberland (NYSE: TBL), and Wolverine (NYSE: WWW) in the dust, and rapidly closing in on Columbia Sportswear (Nasdaq: COLM).

Speaking of which, remember how on Friday, we discussed Columbia's sliding sales in sportswear and footwear? Remember how I said we need to monitor how Columbia's competitors perform in these categories, to determine whether the whole industry is contracting, or whether Columbia is perhaps losing share to rivals like UA? Well, we get our first clue tomorrow morning. Don't be late.

Related Foolishness:

And don't forget to claim your free trial of Motley Fool Rule Breakers to learn what our dedicated team of hypergrowth investors thinks of Under Armour's results. Sign up for the newsletter now, and you'll be first in line to read the team's analysis of the quarter's news when it comes out.

Fool contributor Rich Smith does not own shares of any company named above. Columbia is a Motley Fool Hidden Gems selection. Under Armour is a Rule Breakers pick. The Fool owns share of Under Armour. The Fool has a disclosure policy.