Collins Stewart Starts Urban Outfitters, Inc. (URBN) at Neutral
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Price: $77.81 +2.11%
Rating Summary:
15 Buy, 26 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
15 Buy, 26 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Collins Stewart initiates coverage on Urban Outfitters, Inc. (NASDAQ: URBN) with a Neutral. PT $28.00.
Collins analyst says, "Urban Outfitters has been dealing with fashion misses at both core concepts, which resulted in a consolidated SSS decline in Q3 and increased margin pressure stemming from elevated markdowns. In its Q3 10-Q, URBN indicated SSS were up mid-single-digits so far in Q4 through early December. We believe aggressive promotions can be credited for much of this improvement. Further margin compression seems likely in Q4 given URBN’s bloated inventory levels and continued markdowns. We expect higher product costs will weigh on gross margin in Q4 and into H1:13, as well. Recent leadership changes at Urban Outfitters and Anthropologie are positive steps, but in light of recent sales trends, significant stylistic improvements are needed at both brands. The stock has declined approximately 25% YTD, versus the S&P 500 index’s 3% decline and a 2% return from the RLX index. Without a fashion upgrade, we don’t foresee a compelling catalyst that will drive these shares higher in the near term."
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 $26.14 yesterday.
Collins analyst says, "Urban Outfitters has been dealing with fashion misses at both core concepts, which resulted in a consolidated SSS decline in Q3 and increased margin pressure stemming from elevated markdowns. In its Q3 10-Q, URBN indicated SSS were up mid-single-digits so far in Q4 through early December. We believe aggressive promotions can be credited for much of this improvement. Further margin compression seems likely in Q4 given URBN’s bloated inventory levels and continued markdowns. We expect higher product costs will weigh on gross margin in Q4 and into H1:13, as well. Recent leadership changes at Urban Outfitters and Anthropologie are positive steps, but in light of recent sales trends, significant stylistic improvements are needed at both brands. The stock has declined approximately 25% YTD, versus the S&P 500 index’s 3% decline and a 2% return from the RLX index. Without a fashion upgrade, we don’t foresee a compelling catalyst that will drive these shares higher in the near term."
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 $26.14 yesterday.
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