Urban Outfitters (NASDAQ:URBN) Issues Quarterly Earnings Results

Urban Outfitters (NASDAQ:URBN) released its quarterly earnings results on Wednesday. The apparel retailer reported $1.43 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.24 by $0.19, Zacks reports. Urban Outfitters had a net margin of 8.15% and a return on equity of 18.33%.

Here are the key takeaways from Urban Outfitters’ conference call:

• URBN reported a record Q3 — total revenue grew ~12% to $1.5B and net income rose ~13% to $116M, with every brand producing positive comparable sales.
• Nuuly accelerated rapidly, delivering 49% revenue growth and nearly 400,000 average active subscribers, and URBN is expanding logistics (Kansas City) to support further scale.
• Urban Outfitters materially turned around with a 13% global retail comp (10% North America, 17% Europe) and achieved a low-single-digit operating profit in Q3.
• Tariffs are a meaningful headwind — management estimates ~60 bps gross margin pressure in Q3 and ~75 bps in Q4, with ongoing uncertainty that could affect future margins.
• Gross profit dollars rose ~13% and margin improved ~31 bps due to lower markdowns and occupancy leverage, but SG&A increased ~14% (marketing and store labor), partially offsetting gains.

Urban Outfitters Trading Up 0.9%

NASDAQ:URBN traded up $0.57 during trading hours on Wednesday, reaching $65.46. The company had a trading volume of 3,401,195 shares, compared to its average volume of 1,602,953. The firm has a market cap of $5.87 billion, a price-to-earnings ratio of 12.35, a PEG ratio of 0.91 and a beta of 1.24. Urban Outfitters has a 52 week low of $41.89 and a 52 week high of $84.35. The firm’s 50 day moving average price is $73.18 and its 200-day moving average price is $71.63.

Insider Transactions at Urban Outfitters

In other Urban Outfitters news, CEO Richard A. Hayne sold 10,667 shares of the company’s stock in a transaction dated Friday, February 20th. The stock was sold at an average price of $70.50, for a total value of $752,023.50. Following the completion of the sale, the chief executive officer owned 17,449,385 shares in the company, valued at $1,230,181,642.50. This represents a 0.06% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available through this hyperlink. Also, insider Margaret Hayne sold 9,333 shares of the stock in a transaction that occurred on Friday, February 20th. The stock was sold at an average price of $70.50, for a total transaction of $657,976.50. Following the completion of the sale, the insider directly owned 1,933,859 shares of the company’s stock, valued at $136,337,059.50. This represents a 0.48% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last 90 days, insiders have sold 602,850 shares of company stock valued at $45,557,264. Corporate insiders own 31.80% of the company’s stock.

Hedge Funds Weigh In On Urban Outfitters

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in URBN. Dimensional Fund Advisors LP raised its holdings in shares of Urban Outfitters by 8.1% during the 4th quarter. Dimensional Fund Advisors LP now owns 3,975,316 shares of the apparel retailer’s stock worth $299,183,000 after acquiring an additional 299,380 shares in the last quarter. Abrams Bison Investments LLC bought a new position in shares of Urban Outfitters in the 4th quarter valued at about $127,114,000. Arrowstreet Capital Limited Partnership raised its position in Urban Outfitters by 9.4% during the fourth quarter. Arrowstreet Capital Limited Partnership now owns 791,676 shares of the apparel retailer’s stock valued at $59,582,000 after purchasing an additional 67,777 shares during the period. Balyasny Asset Management L.P. increased its position in shares of Urban Outfitters by 5,360.2% during the 3rd quarter. Balyasny Asset Management L.P. now owns 618,152 shares of the apparel retailer’s stock valued at $44,155,000 after purchasing an additional 606,831 shares during the last quarter. Finally, Invesco Ltd. lifted its position in Urban Outfitters by 16.8% in the fourth quarter. Invesco Ltd. now owns 568,906 shares of the apparel retailer’s stock worth $42,816,000 after buying an additional 81,804 shares during the last quarter. 77.61% of the stock is owned by institutional investors.

Analyst Ratings Changes

Several research analysts have recently issued reports on URBN shares. Morgan Stanley increased their target price on Urban Outfitters from $85.00 to $91.00 and gave the stock an “overweight” rating in a research report on Wednesday, November 26th. Citigroup boosted their target price on shares of Urban Outfitters from $76.00 to $80.00 and gave the company a “neutral” rating in a report on Wednesday, November 26th. Barclays upped their target price on shares of Urban Outfitters from $98.00 to $102.00 and gave the stock an “overweight” rating in a research report on Friday, January 16th. Zacks Research cut shares of Urban Outfitters from a “strong-buy” rating to a “hold” rating in a research report on Thursday, November 6th. Finally, Guggenheim started coverage on shares of Urban Outfitters in a research note on Tuesday, December 9th. They set a “neutral” rating on the stock. Eight analysts have rated the stock with a Buy rating, eight have issued a Hold rating and one has assigned a Sell rating to the company. Based on data from MarketBeat.com, Urban Outfitters currently has an average rating of “Hold” and an average target price of $86.67.

Key Stories Impacting Urban Outfitters

Here are the key news stories impacting Urban Outfitters this week:

• Positive Sentiment: Q4 earnings beat — URBN reported $1.43 EPS vs. $1.24 consensus and showed an 8.15% net margin and 18.33% ROE, which supports near-term profitability improvements. Read More.
• Positive Sentiment: Namesake-store turnaround — The core Urban Outfitters banner, previously a drag, is now driving sales gains, helping lift comparable-store performance. Read More.
• Positive Sentiment: Nuuly rental business outperformed targets — The WSJ reports the Nuuly clothing-rental service beat its sales target and added subscribers, indicating a growing, higher-margin revenue stream. Read More.
• Neutral Sentiment: Analyst reaction mixed entering earnings — Some analysts lowered pre-quarter forecasts and models diverged, so near-term guidance and analyst revisions will matter for momentum. Read More.
• Neutral Sentiment: Valuation debate — Recent pullback has improved valuation metrics for some longer-term investors, but this is a gradual thesis rather than an immediate catalyst. Read More.
• Neutral Sentiment: Elevated trading volume — Volume is above average today, signaling heightened investor interest and opinion dispersion (can amplify moves in either direction).
• Negative Sentiment: Heavy insider selling — Multiple recent sales by executives (including Margaret Hayne and filings tied to senior insiders) have been significant in aggregate and are pressuring sentiment despite insiders’ large remaining stakes. Read More.

Urban Outfitters Company Profile

Urban Outfitters, Inc is a global lifestyle retailer headquartered in Philadelphia, Pennsylvania. Established in 1970 by Richard Hayne, Scott Belair and Judy Wicks, the company began as a single store catering to college students in the city’s historic Old City neighborhood. Over the decades, Urban Outfitters has expanded its reach and diversified its portfolio to include multiple retail concepts addressing distinct customer segments.

The company operates through several well-known brands, each offering a curated selection of apparel, footwear, accessories and home goods.