Goldman Sachs Downgrades Urban Outfitters, Inc. (URBN) to Neutral

Goldman Sachs downgraded Urban Outfitters, Inc. (NASDAQ: URBN) from Buy to Neutral with a price target of $31.00 (from $44.00). EPS estimates were reduced to 1.72/$1.93/$2.13 from $1.93/$2.32/$2.58 for FY15/16/17. The change follow its Q3 warning yesterday.

Analyst Lindsay Drucker Mann said, "We downgrade URBN to Neutral from Buy after 3Q results failed to show the positive momentum we were hoping for. We still believe in the long-term potential of the story and are optimistic a UO brand turnaround is on the horizon, but with the Anthro brand now showing signs of softness, we are concerned a recovery in EPS and sentiment will take longer to materialize."

"Our analysis of promotional activity shows an improved cadence at UO, consistent with management commentary about tighter inventory and better full-price selling. Still, comps appear to be running down high-single digits, and we lack confidence at this stage that the brand will accelerate as much as we had hoped over holidays," added the analyst.

For an analyst ratings summary and ratings history on Urban Outfitters, Inc. click here. For more ratings news on Urban Outfitters, Inc. click here.

Shares of Urban Outfitters, Inc. closed at $34.56 yesterday.

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