Here's Why You Should Snap Up Urban Outfitters Right Now
Zacks Investment Research | Apr 18, 2018 10:56PM ET
A robust job market and rising disposable income spell hope for the retail industry. For investors who are on the hunt for stocks yielding high returns, Urban Outfitters, Inc. (NASDAQ:URBN) is a great option. The stock, which has a long-term expected growth rate of 12%, scaled to a 52-week high of $40.23 on Apr 18, eventually closing a tad lower at $39.68.
The company’s strategies have resulted in better-than-expected earnings and revenues for the third straight quarter, with the latest release being that of fourth-quarter fiscal 2018.
Let’s Delve Deeper
This Zacks Rank #1 (Strong Buy) company has adopted various strategic initiatives to attract customers. The latest one is the partnership with Nordstrom (NYSE:JWN) , whereby more than 200 items from Anthropologie Home are now available at select Nordstrom full-line stores and on Nordstrom.com, effective Mar 19.
Earlier, the company had made an unprecedented move by acquiring Philadelphia’s The Vetri Family group of restaurants, including the Pizzeria Vetri chain. The attempt is seen as part of the company's strategy to target and attract millennials to the stores.
This multi-brand and multi-channel retailer offers flexible merchandising strategy to attract customers. We believe new store openings, increase digital penetration, merchandising improvements and international expansion bode well for the long term. Management is also making all possible efforts to enhance the performance of brands through store refurbishment and by bringing in more compelling assortments.
Lifting investor sentiment, management has provided a solid guidance, courtesy of strategic initiatives undertaken by the company. Management has hinted that retail segment sales are off to a solid start in first-quarter fiscal 2019. Based on current sales trends, the company expects gross margin rate to improve approximately 100 basis points during the first quarter on a year-over-year basis.
During the final quarter of fiscal 2018, comparable retail segment net sales, including the comparable direct-to-consumer channel, were up 4% year over year. Moreover, comparable retail segment net sales inched up 2% at Urban Outfitters, 5% at Anthropologie Group and 8% at the Free People.
Notably, the stock has gained 9.1%, as against the Original post
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