When you're hot, you're hot, and Urban Outfitters (NASDAQ:URBN) seems to be sizzling. The retailer posted more hot earnings numbers today, making one question whether it makes sense for investors to bet against Urban Outfitters at the moment.

Urban Outfitters, which also operates the stores Anthropologie and Free People, reported third-quarter earnings that were a whopping 85% higher at $26 million, or $0.31 per share, just a penny more than the consensus estimate. Net sales burgeoned by 52% to $216.4 million. Same-store sales increased 18%, which is even more impressive since it faced a rather tough comparison to last year's same-store sales increase.

If you check out the balance sheet, Urban Outfitters has no debt; it uses cash on hand to fund its continued expansion. Speaking of which, its cash and near-cash stockpile increased 47% to $86.9 million, and it increased free cash flow by 40% to $10.3 million.

Despite the fact that retail is a fun industry to track, I'm ashamed to admit that over recent months, I hadn't noticed how hot Urban Outfitters was. I was paying more attention to other retailers, such as Motley Fool Stock Advisor pick Gap (NYSE:GPS), Chico's (NYSE:CHS), and Ann Taylor (NYSE:ANN). The last time I remember being jarred into thinking about Urban Outfitters was when it pulled this admittedly outrageous stunt, similar to those from another teen retailer, Abercrombie & Fitch (NYSE:ANF).

However, the rebellion factor seemed to work in Urban Outfitters' favor with its young, hip audience -- or at least, the antics didn't hurt it much. Since this March article, it has reported consistently impressive earnings and has been steadily outperforming the S&P 500.

Despite the good vibes emanating from this retailer, one might wonder -- quite fairly -- whether the stock has rocked way past bargain status. After all, it's currently trading at a forward P/E of 42, and that may be a little too hot to handle for many investors. However, there are other red-hot retailers that continually prove the calls of "overvalued" incorrect and trade at similar P/E ratios, such as Chico's.

With all this in mind, I plan to do a longer investigation of Urban Outfitters in the near future, digging deeper into the numbers. Urban Outfitters may be dressed to kill, but is it a killer investment?

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Alyce Lomax does not own shares of any of the companies mentioned.