Urban Outfitters Earnings: Solid Sales Confirmed and Outlook Is Reasonable; Shares Fully Valued

No-moat Urban Outfitters’ sales results for fiscal 2024’s fourth quarter aligned with our estimates, which we had revised after its holiday sales update in early January. The firm’s namesake retailer continued to struggle, but its other segments posted stellar sales. Even so, investors may have been disappointed that Urban Outfitters’ margins were not higher and that sales slowed in the final month of the quarter, as after a roughly 40% rally over the past three months, its shares slid 10% in aftermarket trading on Feb. 27. After this move, they are trading very close to our $42.50 per share fair value estimate, which we do not expect to change.