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Is Urban Outfitters (URBN) Stock Undervalued Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company value investors might notice is Urban Outfitters (URBN - Free Report) . URBN is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock holds a P/E ratio of 13.77, while its industry has an average P/E of 17.77. Over the past year, URBN's Forward P/E has been as high as 15.49 and as low as 9.02, with a median of 11.49.

Investors will also notice that URBN has a PEG ratio of 1.15. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. URBN's PEG compares to its industry's average PEG of 1.33. URBN's PEG has been as high as 1.78 and as low as 0.79, with a median of 1.04, all within the past year.

We should also highlight that URBN has a P/B ratio of 2.67. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 6.02. URBN's P/B has been as high as 2.87 and as low as 1.40, with a median of 1.92, over the past year.

Finally, investors will want to recognize that URBN has a P/CF ratio of 11.47. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. URBN's P/CF compares to its industry's average P/CF of 14.66. Within the past 12 months, URBN's P/CF has been as high as 12.80 and as low as 7.56, with a median of 9.75.

Value investors will likely look at more than just these metrics, but the above data helps show that Urban Outfitters is likely undervalued currently. And when considering the strength of its earnings outlook, URBN sticks out at as one of the market's strongest value stocks.


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