Financial Trading Blog
Stock of the day 12/08/2016 – Urban Outfitters Inc
It’s been a relatively tumultuous 2016 for Urban Outfitters so far; from an opening price of $23.21 (roughly an 8 and a half year nadir) the stock had climbed to an 8 month peak of $34.56 by the start of April, only to find itself trapped between $26 and £30 from May onwards. Urban Outfitters sits at a current trading price of $30.50 (IT-Finance.com, 12/08/2016).
(Source: IT-Finance.com 12/08/2016)
The main catalyst for Urban Outfitters early in the year surge was the company’s Q4 report in March, which saw the stock jump 16% in a single session as it posted a better than expected 9.2% slide in profits to $72.9 million. An update at the start of April, which stated that first quarter sales were in the low single digits (compared to the 1% decline forecast), then sent the stock to its aforementioned 8 month high, only for it to abruptly tumble as the company lost the latest round of its court case against the Navajo Nation over the retailer’s use of the tribe’s name.
This decline gathered pace as April turned into May, causing the stock to hit $24.59 in the middle of the latter month. Yet once again it was rescued by an earnings release that wasn’t quite as bad as people were expecting, its first quarter figures sending the stock back above $28 as a 3% rise in sales helped compensate for a 9.8% slide in profit to $29.6 million. The company’s latest knock then came at the start of June, dropping 6% as it warned that like-for-like sales were suffering in the second quarter.
In terms of Urban Outfitters’ Q2 figures analysts are expecting the fashion retailer to post a 7.7% rise in earnings per share to 56 cents alongside a 2.2% increase in revenue to $886.39 million.
Urban Outfitters Inc has a consensus rating of ‘Hold’ with an average target price of $31.41.
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