Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Why Urban Outfitters Stock Rose Today

By Jeremy Bowman - Sep 30, 2019 at 12:38PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Shares of the hip apparel retailer gained on an analyst upgrade.

What happened

Shares of Urban Outfitters ( URBN -1.37% ) were climbing after the apparel and lifestyle company got an upgrade from Wells Fargo. The stock was up 5.2% as of 10:58 a.m. EDT.  

So what 

The parent of brands including Anthropologie and Free People saw its rating go from market perform to outperform at Wells Fargo. Analyst Ike Bourchow also lifted his price target from $25 to $30, citing strong performance from the company's fall merchandise assortment and increasing comparable sales, adding that recent turnaround efforts were beginning to bear fruit. 

The entrance to an Urban Outfitters store

Image source: Urban Outfitters.

Now what 

Urban Outfitters has been among the more aggressive retailers that confront the "retail apocalypse," making strategic changes to its business model after CEO Richard Hayne in 2017 likened the industry to the housing bubble of a decade ago, saying that a retail bubble was about burst. 

The company acquired a small pizza chain and has been building campus-like shopping centers with retail, food, and entertainment, including concerts and live events.

Like much of the retail industry, Urban Outfitters has struggled in recent years as the stock has been range-bound for the past decade and growth has been slow. However, shares have been gaining over the last month and a half, and are up nearly 40% now since a bottom in August as news of an improving trade relationship with China has also helped the stock.

Urban Outfitters won't report third-quarter earnings until November, but analysts are also calling for earnings per share to fall from $0.70 to $0.56. After today's upgrade and the favorable commentary, that forecast could move higher, potentially lifting the stock again.

 
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Urban Outfitters, Inc. Stock Quote
Urban Outfitters, Inc.
URBN
$32.32 (-1.37%) $0.45
Wells Fargo & Company Stock Quote
Wells Fargo & Company
WFC
$49.41 (-1.67%) $0.84

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
652%
 
S&P 500 Returns
142%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/08/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.