Trade-Ideas: Urban Outfitters (URBN) Is Today's Post-Market Leader Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Urban Outfitters ( URBN) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Urban Outfitters as such a stock due to the following factors:

  • URBN has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $74.2 million.
  • URBN is up 3.5% today from today's close.

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More details on URBN:

Urban Outfitters, Inc. engages in the retail and wholesale of general consumer products in the United States. It operates in two segments, Retail and Wholesale. The company operates retail stores under the Urban Outfitters, Anthropologie, Free People, Terrain, and BHLDN brands. URBN has a PE ratio of 19.4. Currently there are 15 analysts that rate Urban Outfitters a buy, no analysts rate it a sell, and 8 rate it a hold.

The average volume for Urban Outfitters has been 2.3 million shares per day over the past 30 days. Urban Outfitters has a market cap of $5.3 billion and is part of the services sector and retail industry. The stock has a beta of 1.32 and a short float of 4.4% with 2.71 days to cover. Shares are down 8.6% year-to-date as of the close of trading on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Urban Outfitters as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, notable return on equity and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • URBN's revenue growth has slightly outpaced the industry average of 8.7%. Since the same quarter one year prior, revenues rose by 11.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • URBN has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.46, which illustrates the ability to avoid short-term cash problems.
  • URBAN OUTFITTERS INC has improved earnings per share by 17.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, URBAN OUTFITTERS INC increased its bottom line by earning $1.61 versus $1.18 in the prior year. This year, the market expects an improvement in earnings ($1.88 versus $1.61).
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Specialty Retail industry and the overall market on the basis of return on equity, URBAN OUTFITTERS INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • 37.76% is the gross profit margin for URBAN OUTFITTERS INC which we consider to be strong. Regardless of URBN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, URBN's net profit margin of 9.07% compares favorably to the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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