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On Thursday, BMO Capital Markets increased its price target on Urban Outfitters, Inc. (NASDAQ:URBN) shares, lifting it from $58.00 to $76.00 while maintaining a Market Perform rating. The adjustment came after the company reported a broad-based beat in its first-quarter results, which included a notable positive inflection in comparable store sales for the Urban Outfitters brand. According to InvestingPro data, the stock is currently trading near its 52-week high of $63.21, with four analysts recently revising their earnings estimates upward.
The company’s gross margin (GM) was particularly robust, and management has provided guidance for a 50-100 basis points improvement in the second quarter’s GM. This outlook aligns with their expectations for the full year. BMO Capital’s analysts believe that the company’s guidance may be on the conservative side and anticipate that the actual results could be more favorable. InvestingPro analysis shows the company maintains a strong financial health score, with robust cash flows and moderate debt levels. The stock appears undervalued based on InvestingPro’s Fair Value calculations.
Urban Outfitters’ strong performance has prompted BMO Capital to revise upward their earnings estimates for the company. The new price target of $76.00 is based on approximately 13 times the firm’s projected earnings per share (EPS) for the fiscal year 2027. The analysts at BMO Capital expressed confidence in the company’s continued upward trajectory, suggesting that the recent financial results send a positive signal about Urban Outfitters’ future.
The analysts also noted that, barring any significant missteps or the emergence of macroeconomic pressures later in the year, they expect the company’s stock to react positively to the news. The increase in the price target reflects the firm’s acknowledgment of Urban Outfitters’ strong momentum and its potential to continue on this growth path.
In other recent news, Urban Outfitters, Inc. reported robust financial results for the first quarter of fiscal year 2026, with earnings per share (EPS) of $1.16, surpassing the forecasted $0.83, and revenue reaching $1.33 billion, exceeding expectations of $1.29 billion. This strong performance was driven by an 11% year-over-year revenue growth, supported by positive comparable store sales across its brands, including a 7% rise for Anthropologie and a 3% increase for Free People. Analysts from BofA Securities responded by raising their price target for Urban Outfitters to $80, maintaining a Buy rating, while JPMorgan upgraded the stock to Overweight, despite lowering the price target to $56.90. Morgan Stanley (NYSE:MS) also expressed optimism, increasing its price target to $77 and highlighting the company’s strong revenue growth trajectory and operational resilience. Meanwhile, Jefferies raised its price target to $50 but retained an Underperform rating, noting challenges in the North American market despite positive results elsewhere. Urban Outfitters’ subscription service, Nuuly, reported a significant 60% increase in sales, contributing to the company’s overall positive outlook. These developments reflect a favorable market response to Urban Outfitters’ strategic initiatives and financial health.
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