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Bull Of The Day: Urban Outfitters (URBN)
Urban Outfitters (URBN - Free Report) is a Zacks Rank #1 (Buy) and it sports an A for Value and a B for Growth. This retail name has held up pretty well despite a slowing economy. Let’s explore more about this company in this Bull of The Day article.
Urban Outfitters, Inc. engages in the retail and wholesale of general consumer products. As of January 31, 2022, it operated 261 Urban Outfitters, 238 Anthropologie Group, and 173 Free People stores in the United States, Canada, and Europe; and 10 restaurants, as well as two Urban Outfitters and one Anthropologie franchisee-owned stores. The company was founded in 1970 and is based in Philadelphia, Pennsylvania.
When I look at a stock, the first thing I do is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has communicated to the market. A stock that consistently beats has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
For Urban Outfitters, I see three straight misses of the Zacks Consensus Estimate followed up most recently by an earnings meet. That is not that great to see, but by itself that is not enough to make the company a Zacks Rank #1 (Strong Buy).
Earnings Estimates Revisions
The Zacks Rank tells us which stocks are seeing earnings estimates move higher.
Over the last 60 days, earning estimates have moved around for URBN.
This quarter has shifted lower from 39 to 36 cents.
Next quarter has seen a move higher from $0.77 to $0.83.
The full fiscal year 2024 has increased from $2.29 to $2.48 over the last 60 days.
Next Fiscal year, has seen a small move higher to $2.77 from $2.70
Positive movement in earnings help move this stock to a Zacks Rank #1 (Strong Buy).
The valuation for URBN is very reasonable at these levels. I see a forward earnings multiple of 10x and a price to book multiple of 1.4x. Growth is rather low at 4% and margins are looking rather tight. If nothing else consistency in a time of broader uncertainty makes this stock worth a hard look.