Urban Outfitters slumps on 'surprise' Q4 profit miss as costs bite

Urban Outfitters

28/02/2024 15:20

(Updates)
    ** Shares of apparel retailer Urban Outfitters  URBN.O 
plunge 12.8% to $41.15 in early trading, snapping a nine-day
winning streak
    ** Co after markets on Tuesday posted Q4 adjusted earnings
per share of 69 cents, below LSEG estimates of 73 cents
    ** Stock set for its worst session since Nov. 22
    ** Softer traffic from unfavorable weather in January
weighed on traffic and elevated expenses hurt profit, analysts
said
    ** Barclays says Q4 profit miss was an "unexpected surprise"
making clear there was little improvement at the Urban
Outfitters division, the primary driver of the gross margin miss
    ** Although the firm has had to discount move inventory at
the struggling Urban Outfitters nameplate, we think it is
succeeding in raising base merchandise pricing at each of its
three major brands - Morningstar analyst David Swartz 
    ** TAG hikes PT to $48 from $44, maintains "outperform"
rating on stock citing continued strength at Free People and
Anthropologie brands
    ** Four of 14 brokerages rate the stock "buy" or higher, 10
"hold"; their median PT is $44.50
    ** So far this year, stock up 32%
    

 (Reporting by Savyata Mishra in Bengaluru)
 ((Savyata.Mishra@thomsonreuters.com))