Fitness financials: Analyst expects Under Armour to gain from products in '08, plus Collective Brands-adidas, GSI

Analyst expects Under Armour to gain from products in '08. Judge lowers award in Collective Brands-adidas lawsuit. GSI Commerce shares fall on downgrade.

Analyst expects Under Armour to gain from products in '08

Despite a weak U.S. economy that has hurt business for many retailers, Under Armour (NYSE: UA) is poised to gain from better products and pricing, an analyst said.

After meeting with senior management recently, Stifel Nicolaus & Co. analyst Thomas D. Shaw wrote in a client note that he expects "more streamlined processes in product engineering, product pricing, and marketing timing" to benefit the retailer's sales and margins.

Shaw wrote that the company's bookings for the second half of 2008 are "trending comparably" to last year, which is positive, especially considering a lean inventory stance adopted by many retailers. He added that order cancellations and product returns are either flat are declining from a year ago.

For the rest of the year, Shaw said he will watch to see if the company can boost sales of men's apparel and whether consumers will pay for the company's higher-priced products this fall and winter. He rated the stock as a "Hold."

Judge lowers award in Collective Brands-adidas lawsuit

Collective Brands (NYSE: PSS), parent of Saucony and Hind, said a federal judge in Oregon has reduced a judgment against the company in a trademark infringement case with adidas by nearly 80 percent.

The award was cut from $305 million to $64.4 million. Collective Brands had asked the judge to reduce the award, calling it "unsupportable and excessive."

A federal jury in May determined that Collective Brands violated adidas' trademarked three-stripe logo on some of its shoes and ordered the company to pay damages. adidas filed the suit in 2001.

The judge did not grant Collective Brands request for a new trial.

Matt Rubel, Collective Brands' CEO, said in a statement that he was pleased the judge lowered the judgment but that the company will appeal the verdict.

Soleil Securities Group analyst Jeffrey Stein wrote in a client note the development is positive for Collective Brands and upped his price target on the shares by $3 to $25, and maintained his "Buy" rating.

"The latest developments eliminate a high level of uncertainty regarding the Collective Brands balance sheet and its ability to reinvest in its business and/or make future acquisitions," Stein wrote.

GSI Commerce shares fall on downgrade

Shares of GSI Commerce (Nasdaq: GSIC) dropped nearly 7 percent as an analyst downgraded the designer and operator of retailer websites.

While the company is expected to do well in the holiday season despite broader retail woes, Stifel Nicolaus & Co. analyst Scott Devitt told clients that investors might be able to profit more by owning shares of other e-commerce companies like Amazon.

Part of the problem with GSI Commerce's stock, Devitt wrote in a research note, is that it had already risen almost 50 percent since July and was approaching his firm's price target of $19, meaning in his view investors wouldn't likely be able to squeeze much more profit out of the shares in the near term.

"We believe GSI Commerce is a well-positioned, well-managed company and our current rating change is based on valuation, which should remain relevant in this difficult economic environment," Devitt wrote. He downgraded the stock from "Buy" to "Hold."

GSI Commerce's shares fell $1.17 to close at $16.51 on Sept. 12.

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