Urban Outfitters: Sales Soft Into Q1
- March 6, 2019
Oppenheimer analysts looked upon the fourth quarter (January 2019) results and initial first quarter (April) guidance that perform-rated Urban Outfitters (URBN) reported after the close on Tuesday (March 5th) as mixed.
In the fourth quarter, better gross margins helped to offset modest sales weakness and a bit higher expenses, to fuel modestly better than expected earnings per share. That said, sales trends softened as January progressed and remained sluggish into the current quarter. The team is optimistic that an onset of spring weather in coming weeks and tweaks to certain product offerings could bolster sales trends, but believe it better to stay on the sidelines, until clearer evidence of a shift in top-line momentum at the chain emerges.
Valuation should continue to lend support to Urban Outfitters' shares, even as fundamentals falter somewhat.
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