Nomura Securities Maintains a 'Neutral' on Urban Outfitters (URBN); 3Q Review

Nomura Securities maintains a 'Neutral' on Urban Outfitters, Inc. (NASDAQ: URBN) price target of $28.00.

Nomura analyst, Paul Lejuez, said, "3Q EPS was $0.33 vs. our est of $0.31 and cons of $0.32. A lower tax rate helped by $0.02. No surprises on the top line (as URBN pre-announced sales last week), but GM pressure was significantly higher than we had forecast. With high inventory levels going into 4Q and lack of momentum in most of its businesses, we believe margin pressure will be greater than anticipated in 4Q. We do not expect the company to meet consensus in 4Q and believe F12 will be a tricky year as new additions to management find their footing. Based on lower GM than previously forecast, we are reducing our 4Q11E from $0.40 to $0.37 (cons is $0.44). Our F11E is $1.28 vs. $1.29 previously. While we like the URBN growth story, the turnaround appears too far out.'

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 $26.83 yesterday.

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