Urban Outfitters Quarter-to-Date Comps on Track Versus Expectations

In its 10-K filed after the markets closed on Tuesday, Urban Outfitters indicated quarter-to-date comp trends are in the negative low-single-digit range, likely putting the company on track to meet full-quarter consensus expectations for an approximate 1% comp increase and our estimate of relatively flat given the shift in Easter to late April.

Urban’s 10-K also indicated that the company repurchased 4.5 million shares at a total cost of $162 million since January 31.

At 18 times 2014 EPS estimate, analysts expect a modestly positive reaction to on-plan sales trends and the news of the share repurchase. Investors continue to like Urban Outfitters’ shares given tangible returns on management’s investments (including much improved full-priced selling) in addition to the potential for accelerating comp trends in second half of the year as comparisons ease.

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