Is This the Long-Awaited Urban Outfitters Turnaround?

Urban Outfitters Inc. (NASDAQ: URBN) reported its fiscal fourth-quarter results after the markets closed on Monday, and it appears that investors had a totally opposite reaction here than to an up-and-coming burger chain. This specialty lifestyle retailer posted a solid quarter, although the profit was down for a second consecutive year, but investors still cheered it on nonetheless.

The company had $0.61 in earnings per share (EPS) on $1.01 billion in revenue. That compared to the consensus estimates from Thomson Reuters of $0.56 in EPS on revenue of $1.02 billion. In the same period of the previous year, the company posted EPS of $0.60 and $1.01 billion in revenue.

Comparable Retail segment net sales, which include the comparable direct-to-consumer channel, decreased 2%. Comparable Retail segment net sales increased 2% at Free People and decreased 2% at the Anthropologie Group and 3% at Urban Outfitters. Wholesale segment net sales increased 29%, partially due to delayed shipments from the third quarter carrying over into the fourth quarter.

In terms of its business segments, Urban Outfitters reported:

• The Urban Outfitters brand had net sales of $415.8 million.
• The Anthropologie Group brand had net sales of $419.1 million.
• The Free People brand had net sales of $178.5 million.

[recirclink id=317601]
On the books, cash, equivalents and marketable securities totaled $326.3 million at the end of the quarter, compared to $258.8 million in the same period last year.

A few analysts weighed in on Urban Outfitters just after the earnings report was posted:

• Brean Capital has a Buy rating and raised its price target to $35 from $32.
• Webush has a Neutral rating but raised its price target from $23 to $32.
• Cowen raised its target price to $33.
• Stifel has a Buy rating and raised its price target to $34 from $30.
• RBC Capital has a Sector Perform rating and raised its price target to $30 from $25.
• Wunderlich has a Hold rating and raised its price target from $22 to $26.
• Telsey Advisory Group has a Market Perform rating and raised its price target to $35 from $23.
• Mizuho has a Neutral rating and raised its price target to $30 from $20.
• FBR has a Market Perform rating and raised its target price to $29 from $26.
• Merrill Lynch reiterated a Buy rating and raised its price target to $36 from $30.

Shares of Urban Outfitters were trading up 13.5% at $31.97 on Tuesday, with a consensus analyst price target of $26.93 and a 52-week trading range of $19.26 to $47.25.