We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Things to Know Ahead of Urban Outfitters' (URBN) Q2 Earnings
Read MoreHide Full Article
Urban Outfitters, Inc. (URBN - Free Report) is scheduled to release second-quarter fiscal 2020 results on Aug 20, after the bell. We note that in the trailing four quarters, the company has outperformed the Zacks Consensus Estimate, recording average positive earnings surprise of 11.8%. In the last quarter, it delivered positive earnings surprise of 19.2%. Let’s see how the company is positioned ahead of the upcoming quarterly results.
Estimates Look Dull
The Zacks Consensus Estimate for the second quarter is pegged at 59 cents, indicating a decline of 29.8% from the year-ago period. Notably, the consensus mark has moved down by a penny in the past 30 days.
The consensus mark for revenues is pegged at $986.6 million, suggesting a marginal decline of 0.6% from the year-ago quarter’s figure.
Urban Outfitters, Inc. Price, Consensus and EPS Surprise
Urban Outfitters witnessed dismal first-quarter fiscal 2020 results and a somewhat similar picture is likely to emerge in the second quarter as well. This is quite evident from the aforementioned Zacks Consensus Estimate.
Management anticipates second-quarter URBN Retail segment comparable sales (comps) to decline in low-single-digit range with gross margin likely to contract more than 300 basis points. We note that the company’s gross margin contracted year over year during the first quarter and rate of growth of comparable Retail segment net sales decelerated sequentially.
Also, this lifestyle products and services company is grappling with increased SG&A expenses for a while now. SG&A expenses are likely to increase roughly 2% in the second quarter, owing to elevated investment to aid digital channel sales and expenses related to the launch of Nuuly. Together, these downsides might hurt the company’s bottom line in the quarter to be reported.
Nonetheless, Urban Outfitters remains committed to sustain investments in direct-to-consumer business, enhance productivity in existing channels, add new brands and optimize inventory level. Being a multi-brand and multi-channel retailer, the company offers flexible merchandising strategy. All these are likely to cushion its top line performance.
What Does the Zacks Model Say?
Our proven model does not conclusively show that Urban Outfitters is likely to beat bottom-line estimates this quarter. For this to happen, a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Urban Outfitters Earnings ESP of -3.39% combined with its Zacks Rank #4 (Sell) makes us apprehensive about an earnings beat. Markedly, we caution against sell-rated stocks (Zacks Rank #4 or 5) going into earnings announcement.
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post earnings beat.
Target Corporation (TGT - Free Report) has an Earnings ESP of +1.04% and a Zacks Rank #2.
Ross Stores, Inc. (ROST - Free Report) has an Earnings ESP of +1.79% and a Zacks Rank #3.
Costco Wholesale Corporation (COST - Free Report) has an Earnings ESP of +0.79% and a Zacks Rank #3.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Things to Know Ahead of Urban Outfitters' (URBN) Q2 Earnings
Urban Outfitters, Inc. (URBN - Free Report) is scheduled to release second-quarter fiscal 2020 results on Aug 20, after the bell. We note that in the trailing four quarters, the company has outperformed the Zacks Consensus Estimate, recording average positive earnings surprise of 11.8%. In the last quarter, it delivered positive earnings surprise of 19.2%. Let’s see how the company is positioned ahead of the upcoming quarterly results.
Estimates Look Dull
The Zacks Consensus Estimate for the second quarter is pegged at 59 cents, indicating a decline of 29.8% from the year-ago period. Notably, the consensus mark has moved down by a penny in the past 30 days.
The consensus mark for revenues is pegged at $986.6 million, suggesting a marginal decline of 0.6% from the year-ago quarter’s figure.
Urban Outfitters, Inc. Price, Consensus and EPS Surprise
Urban Outfitters, Inc. price-consensus-eps-surprise-chart | Urban Outfitters, Inc. Quote
Factors at Play
Urban Outfitters witnessed dismal first-quarter fiscal 2020 results and a somewhat similar picture is likely to emerge in the second quarter as well. This is quite evident from the aforementioned Zacks Consensus Estimate.
Management anticipates second-quarter URBN Retail segment comparable sales (comps) to decline in low-single-digit range with gross margin likely to contract more than 300 basis points. We note that the company’s gross margin contracted year over year during the first quarter and rate of growth of comparable Retail segment net sales decelerated sequentially.
Also, this lifestyle products and services company is grappling with increased SG&A expenses for a while now. SG&A expenses are likely to increase roughly 2% in the second quarter, owing to elevated investment to aid digital channel sales and expenses related to the launch of Nuuly. Together, these downsides might hurt the company’s bottom line in the quarter to be reported.
Nonetheless, Urban Outfitters remains committed to sustain investments in direct-to-consumer business, enhance productivity in existing channels, add new brands and optimize inventory level. Being a multi-brand and multi-channel retailer, the company offers flexible merchandising strategy. All these are likely to cushion its top line performance.
What Does the Zacks Model Say?
Our proven model does not conclusively show that Urban Outfitters is likely to beat bottom-line estimates this quarter. For this to happen, a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Urban Outfitters Earnings ESP of -3.39% combined with its Zacks Rank #4 (Sell) makes us apprehensive about an earnings beat. Markedly, we caution against sell-rated stocks (Zacks Rank #4 or 5) going into earnings announcement.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks With Favorable Combination
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post earnings beat.
Target Corporation (TGT - Free Report) has an Earnings ESP of +1.04% and a Zacks Rank #2.
Ross Stores, Inc. (ROST - Free Report) has an Earnings ESP of +1.79% and a Zacks Rank #3.
Costco Wholesale Corporation (COST - Free Report) has an Earnings ESP of +0.79% and a Zacks Rank #3.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>