Hallelujah! At long last, it looks like investors are starting to come to their senses about Under Armour (NYSE: UA). But that's not how it started out...

To the contrary, yesterday looked like more of the same for the breakout sportswear maker (and Motley Fool Rule Breakers recommendation). Another earnings beat. Another guidance raise. Another investor sell-off in response. No sooner had Under Armour announced its quarterly results…

  • Sales up 15%, to $229 million (compared to Nike's (NYSE: NKE) recent 7% rise, or the 10% growth Columbia Sportswear (Nasdaq: COLM) reported last week)
  • Earnings per share up 75%, to $0.14
  • And guidance raised to about $975 million in revenue, and roughly $1.06 per share in earnings for the year

... than the Greek Financial Crisis reared its ugly head once more. It turned what was already an ugly 3% decline in Under Armour's share price into a full-scale 5% rout of the stock.

Turnabout, and -- finally -- fair play
Fortunately for Under Armour, investors came to their senses this morning and began bidding the shares back up. To my Foolish eye, that's the right call.

First and foremost, Under Armour did precisely what I predicted it would do three months ago. It undersold its progress, then overdelivered when it came time for results. Under Armour is expanding its sales outlets from traditional sports retailers like Cabela's (NYSE: CAB), Dick's Sporting Goods (NYSE: DKS), and the college bookstores run by Barnes & Noble (NYSE: BKS), to sell through department-store chains such as Nordstrom (NYSE: JWN). It's ramping expansion of its Factory House chain -- part of its direct segment, where sales jumped 73%, by the way -- to capture higher margins from direct sales to consumers.

Better still, Under Armour's continuing to improve its balance sheet. I predict that when we see the company's cash flow statement, it will look even better in consequence. As sales surged 15%, Under Armour held accounts receivable growth to a mere 4%, while its inventories actually declined 10%. Amazing results, when you consider that Under Armour has to be stocking its new stores with new inventories -- yet overall, companywide inventories are dropping.

From this Fool's perspective, it's all systems go for Under Armour. I only wish I could stop writing about the stock long enough to pick up a few shares myself.