BTIG analyst Camilo Lyon says that according to contacts, Under Armour (UAA) appears to be making "deep, across-the-board cuts" to its business that are "now starting to hit bone."

Within the last month, the company has sought to end high profile collegiate sponsorships, ended its lacrosse equipment license deal, and has reportedly put its MyFitnessPal app up for sale, Lyon tells investors in a research note. The analyst, noting that some might view these actions as an attempt to improve profitability and shore up its cash position, views the moves "as a sign of a company in distress."

Lyon reiterates a Sell rating on Under Armour with a $5 price target. The stock closed Monday down 29c to $9.91. "We have seen too many companies attempt to cut their way to prosperity only to fail and accelerate the decline of its sales base," writes the analyst.

Lyon expects Under Armour will laud its cost containment efforts on its Q2 earnings call, but adds that "without a plan to restart sales growth, these efforts could fall flat."