Wites & Kapetan, P.A. is announcing their investigation of Urban Outfitters, Inc. (Nasdaq: URBN) and a possible class action lawsuit which may allege that the company and certain of its officers and directors committed violations of the Securities Exchange Act of 1934. On September 9, 2013 after the market closed, Urban Outfitters, Inc. (“Urban Outfitters” or the “Company”) disclosed its second quarter 2013 financial results and commented on third quarter 2014 expectations in a quarterly financial report filed on Form 10-Q with the SEC. Comparable sales at the Company’s Urban Outfitters Group had grown only 5.2% in the 2014 second quarter, far less than the growth the Company had led investors to expect based on prior statements. The Form 10-Q filing also disclosed that “[t]hus far during the third quarter of fiscal 2014, comparable Retail segment net sales are mid single-digit positive.” Following this news, Urban Outfitter’s common stock price declined by $4.36 per share, more than 10%, on September 10, 2013 to close at $38.35 per share.
Class action lawsuits have already filed against Urban Outfitters on behalf of investors who purchased shares of Urban Outfitter’s common stock during the period between March 12, 2013 and September 9, 2013 (the “Class Period”). The complaints allege that during the Class Period Urban Outfitters and the other defendants concealed from the investing public that (a) Urban Outfitters’ comparable sales growth had significantly declined, particularly at its all-important Urban Outfitters group, (b) as a result of declining sales, Urban Outfitters was forced to offer an additional 30% off all clearance items during Labor Day weekend 2013, something it had not been forced to do during the prior Labor Day weekend, and (c) as a result of the foregoing, the Company was not on track to achieve the financial results defendants had led the market to expect during the Class Period.