Wells Fargo takes a step back on Under Armor. The bank downgraded shares of the athletic apparel company to equal weight Friday with overweight. It also lowered its price target from $12 to $8 per share, implying a nearly 9% increase from Thursday’s close. Analyst Will Gaetner pointed to three primary headwinds hitting Under Armor: an overexposure to the North American wholesale market, skyrocketing excess inventories, and a new CEO who is only six months into her tenure. “We expect the NA wholesale channel to remain difficult at least through the end of ’23, which is likely to continue to be a drag on (sales) growth,” said Gaetner. “Retailers remain cautious with orders as headwinds (inflationary pressures, lower government subsidies) continue to weigh on demand.” Gaetner added that the North American wholesale market accounts for more than half of Under Armor’s sales and expects sales growth of 2.2% in 2024. He added that high inventories will put pressure on gross margins, while the newly minted CEO Stephanie Linnartz will need more time to flip the company. “We commend Linnartz for recognizing the challenges and outlining ways to course correct,” he said. “However, we think the changes she talked about, including improving product flow, innovation and segmentation, will take time to pay off.” Under Armor is down more than 27% so far. UA YTD mountain Under Armor shares are down more than 27% since January. – CNBC’s Michael Bloom contributed to this report.