The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
Urban Outfitters is trading at $36.35. The share price initially dropped when the company revealed a decline in first-quarter profits of 20% in May, but it has since recovered. The EPS and revenue for the first three months of the year were broadly in line with expectations, but the increase in costs of 9% worried traders.
The company’s profit margins fell to 34.8% from 36.8%, and that cost could rise to a low double-digit figure for the year. Capital expenditure for the full year until January 2015 should be between $215 and $235 million.
The share price opened lower today after Macy’s revealed a higher-than-expected second-quarter EPS, but cut its full-year profit and revenue forecast. It is worth noting that Urban Outfitters caters for teenagers and young adults, while Macy’s is more focused on the luxury end of the spectrum.
Out of the 38 analysts ratings on Urban Outfitters 23 are buys, 14 are holds and one is a sell. The stock is receiving support at $35.05; if the results beat estimates and the costs don’t rise too high the stock could hit $38.84.