Urban Outfitters Inc. (URBN): Today's Featured Services Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Urban Outfitters ( URBN) pushed the Services sector lower today making it today's featured Services laggard. The sector as a whole closed the day up 0.4%. By the end of trading, Urban Outfitters fell 59 cents (-1.4%) to $42.58 on light volume. Throughout the day, 1.9 million shares of Urban Outfitters exchanged hands as compared to its average daily volume of 2.6 million shares. The stock ranged in price between $42.46-$43.28 after having opened the day at $43.16 as compared to the previous trading day's close of $43.17. Other companies within the Services sector that declined today were: Insperity ( NSP), down 16.6%, QKL Stores ( QKLS), down 16.4%, Innovaro ( INV), down 13.7%, and Bioanalytical Systems ( BASI), down 11.2%.
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Urban Outfitters Inc. operates lifestyle specialty retail stores under the Urban Outfitters, Anthropologie, Free People, Terrain, and BHLDN brand names in the United States, Canada, and Europe. Urban Outfitters has a market cap of $6.3 billion and is part of the retail industry. The company has a P/E ratio of 32.2, above the S&P 500 P/E ratio of 17.7. Shares are up 9.6% year to date as of the close of trading on Thursday. Currently there are 13 analysts that rate Urban Outfitters a buy, no analysts rate it a sell, and 11 rate it a hold.

TheStreet Ratings rates Urban Outfitters as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, Caesars Entertainment ( CZR), up 38.1%, Fleetcor Technologies ( FLT), up 10.8%, Chanticleer Holdings ( HOTR), up 10.6%, and RadioShack ( RSH), up 10%, were all gainers within the services sector with Dollar Tree Stores ( DLTR) being today's featured services sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the services sector could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the services sector could consider ProShares Ultra Short Consumer Sers ( SCC).

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