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Is Urban Outfitters (URBN) a Great Value Stock Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One company value investors might notice is Urban Outfitters (URBN - Free Report) . URBN is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 13.14 right now. For comparison, its industry sports an average P/E of 14.95. Over the last 12 months, URBN's Forward P/E has been as high as 21.58 and as low as 12.53, with a median of 17.26.

URBN is also sporting a PEG ratio of 1.17. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. URBN's industry has an average PEG of 1.27 right now. Over the last 12 months, URBN's PEG has been as high as 1.80 and as low as 0.98, with a median of 1.44.

Another notable valuation metric for URBN is its P/B ratio of 2.84. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. URBN's current P/B looks attractive when compared to its industry's average P/B of 4.03. URBN's P/B has been as high as 3.86 and as low as 2.58, with a median of 3.08, over the past year.

These are only a few of the key metrics included in Urban Outfitters's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, URBN looks like an impressive value stock at the moment.




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