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Urban Outfitters (URBN) Gains But Lags Market: What You Should Know

Zacks

In the latest trading session, Urban Outfitters (URBN) closed at $38.59, marking a +1.37% move from the previous day. This change lagged the S&P 500′s 1.42% gain on the day. At the same time, the Dow added 1.15%, and the tech-heavy Nasdaq gained 2.29%.

Coming into today, shares of the clothing and accessories retailer had lost 13.97% in the past month. In that same time, the Retail-Wholesale sector lost 11.63%, while the S&P 500 lost 5.36%.

Wall Street will be looking for positivity from URBN as it approaches its next earnings report date. This is expected to be November 19, 2018. In that report, analysts expect URBN to post earnings of $0.63 per share. This would mark year-over-year growth of 53.66%. Meanwhile, our latest consensus estimate is calling for revenue of $969.84 million, up 8.63% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.67 per share and revenue of $3.96 billion, which would represent changes of +59.88% and +9.57%, respectively, from the prior year.


Investors might also notice recent changes to analyst estimates for URBN. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.07% higher. URBN is currently a Zacks Rank #1 (Strong Buy).

Investors should also note URBN’s current valuation metrics, including its Forward P/E ratio of 14.28. For comparison, its industry has an average Forward P/E of 15.65, which means URBN is trading at a discount to the group.

Also, we should mention that URBN has a PEG ratio of 1.12. 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. Retail – Apparel and Shoes stocks are, on average, holding a PEG ratio of 1.57 based on yesterday’s closing prices.

The Retail – Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 36, which puts it in the top 14% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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