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Urban Outfitters Inc URBN

Morningstar Rating
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Stock XNAS Rating as of
$41.73 −0.02 (0.05%)
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As of Delayed Price Closed
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Company Report

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Urban Outfitters Earnings: Positive Report Despite Namesake Brand’s Struggles; Shares Fairly Valued

David Swartz

We expect to lift our $42.50 fair value estimate for Urban Outfitters by a low-single-digit percentage after first-quarter results outpaced our expectations but rate its shares, up more than 50% over the past year, as fully valued. Despite nice results in a tough market, we classify the firm as no-moat and think there is limited upside from its current yearly operating margins of about 8% due to competitive pressures.

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Price vs Fair Value

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URBN is trading at a 721% premium.
Price
$41.71
Fair Value
$71.60
Uncertainty
High
1-Star Price
$73.79
5-Star Price
$84.30
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Urban Outfitters generates about half its sales from e-commerce. It was the fourth-largest online apparel and footwear specialist firm in the US in 2023, trailing only Shein, Gap, and Lululemon (Euromonitor).

Bears

Urban Outfitters has more fashion risk than some other retailers. Its sales suffer when it misreads a fashion trend or if a trend moves away from its core styles. Consequently, its sales growth tends to be volatile.

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News

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Trading Information

Previous Close Price
$41.75
Day Range
$41.58–42.36
52-Week Range
$30.05–47.29
Bid/Ask
$39.60 / $42.80
Market Cap
$3.90 Bil
Volume/Avg
1.3 Mil / 1.8 Mil

Key Statistics

Price/Earnings (Normalized)
12.87
Price/Sales
0.75
Dividend Yield (Trailing)
—
Dividend Yield (Forward)
—
Total Yield
0.17%

Company Profile

Founded in 1970, Philadelphia-based Urban Outfitters is an apparel and home goods retailer that operates more than 700 stores and e-commerce in the United States (87% of fiscal 2024 sales) and other regions. Its retail nameplates are Urban Outfitters, Free People, FP Movement, and Anthropologie. Retail accounted for 91% of fiscal 2024 revenue, but the firm also sells products through a wholesale operation, owns some restaurants, and operates a clothing rental and resale business called Nuuly (5% of sales). Urban Outfitters primarily markets to young adults and offers products in categories such as apparel (66% of sales), home goods (16% of sales), accessories (13% of sales), and more.
Sector
Consumer Cyclical
Industry
Apparel Retail
Stock Style Box
Small Core
Total Number of Employees
28,000
Website
https://www.urbn.com

Competitors

Valuation

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Metric
URBN
M
GPS
Price/Earnings (Normalized)
 12.875.9314.23
Price/Book Value
 1.801.342.91
Price/Sales
 0.750.240.51
Price/Cash Flow
 5.563.047.41
Price/Earnings
URBN
M
GPS

Financial Strength

Metric
URBN
M
GPS
Quick Ratio
 0.540.300.71
Current Ratio
 1.291.371.42
Interest Coverage
 47.721.636.22
Quick Ratio
URBN
M
GPS

Profitability

Metric
URBN
M
GPS
Return on Assets (Normalized)
 7.80%5.76%4.85%
Return on Equity (Normalized)
 15.69%23.45%22.84%
Return on Invested Capital (Normalized)
 9.67%11.22%6.69%
Return on Assets
URBN
M
GPS
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LULU
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Gap IncMtnskhzzYdd$7.6 Bil

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