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Urban Outfitters (URBN) AI Stock Analysis

URBN

Urban Outfitters

(NASDAQ:URBN)

Select Model
Rating:79Outperform
Price Target:$104.00â–²(14.64% Upside)
Action:reiterated
Date:08/27/26

URBN scores well primarily on strengthened financial performance (material margin and ROE improvement) and strong technical momentum with price above key moving averages. The score is tempered by mixed cash-flow conversion and slowing revenue growth, while valuation is reasonable but not clearly discounted (P/E ~15.7) and the earnings call supports continued growth despite freight and markdown headwinds.

Positive Factors
Broad-based brand growthGrowth is spread across retail, wholesale, and multiple brands rather than relying on one channel. Positive comparable sales and strong FP Group performance support brand relevance, reduce concentration risk, and provide a durable base for continued revenue expansion.
Negative Factors
Revenue growth is deceleratingSlower revenue growth may limit the pace at which URBN can leverage fixed costs and expand earnings. If demand remains less robust, the company may need continued margin gains and disciplined cost control to sustain financial progress over coming quarters.

Urban Outfitters Key Performance Indicators (KPIs)

Revenue by BrandShows how much each brand under Urban Outfitters contributes to total sales, highlighting which brands are driving growth and which might need strategic adjustments.

$0.00$500.00M$1.00B$1.50BJan 21Apr 21Jul 21Oct 21Jan 22Apr 22Jul 22Oct 22Jan 23Apr 23Jul 23Oct 23Jan 24Apr 24Jul 24Oct 24Jan 25Apr 25Jul 25Oct 25Jan 26Apr 26Jul 26
Chart Insights

Free People and Urban Outfitters are driving durable top‑line momentum with steady comp strength, while Anthropologie remains more volatile but trending higher—its slower quarters are normalizing. The standout is Nuuly, which has moved from a niche experiment to a high‑growth, margin‑accretive business that management now cites as a strategic growth engine. Beware near‑term margin noise: fuel surcharges and tariff volatility will pressure gross margins and a one‑time tariff refund will boost Q2, so focus on underlying retail comps and Nuuly’s subscriber/profit trajectory for sustainability.

Data provided by:The Fly

Urban Outfitters (URBN) vs. SPDR S&P 500 ETF (SPY)

-10%0%10%20%30%40%50%URBN+43.79%SPY+11.79%Dec '25Jan '26Feb '26Mar '26Apr '26May '26Jun '26Jul '26Aug '26Sep '26Oct '26
Market Cap
$7.77B
Dividend Yield
―
Average Volume (3M)
1.10M
Price to Earnings (P/E)
14.0
Beta (1Y)
1.03
Revenue Growth
11.01%
EPS Growth
24.97%
Country
US
Employees
31,000
Sector
Consumer Cyclical
Sector Strength
61
Industry
Apparel - Retail

Urban Outfitters Business Overview & Revenue Model

Company Description

Urban Outfitters, Inc. engages in the operation of a general consumer product retail and wholesale business selling to customers through various channels including retail locations, websites, catalogs, and mobile applications. It operates through the...

How the Company Makes Money

URBN makes money primarily by selling merchandise through its retail and digital channels across its brands (Urban Outfitters, Anthropologie, and Free People). The core revenue model is retail commerce: the company purchases and/or produces inventory...

Urban Outfitters Earnings Call Summary

Earnings Call Date:Aug 25, 2026(Q2-2027)|% Change Since:9.37%|Next Earnings Date:Nov 22, 2026
Earnings Call SentimentPositive

The call conveyed a broadly positive tone driven by record quarterly sales, operating income, and EPS, strong brand-level performances (notably Nuuly, FP group, and Urban Outfitters), and a constructive outlook for Q3 and FY'27 with modest gross margin improvement expected. Key operational investments (logistics automation, AI, store expansion) and tariff refunds further support the outlook. The main near-term challenges are fuel-related freight surcharges, prior tariff-driven cost pressure (largely refunded), and some elevated markdowns/slower turns at Anthropologie. Management emphasized they have largely offset macro headwinds and remain confident in execution, so positive achievements materially outweigh the manageable headwinds.

Positive Updates

Record Quarterly Results
Company delivered record Q2 sales and earnings: net sales grew 10% to $1.7 billion, operating income rose 11% to $193 million, and diluted EPS increased 9% to $1.72. This marked the eighth consecutive quarter of record sales and profits.

Negative Updates

Fuel Surcharges and Freight Headwinds
Higher inbound freight, domestic transportation, and delivery expenses driven by fuel surcharges related to the Middle East war negatively impacted results: Q2 headwind ~50 basis points on IMU and ~20 basis points on outbound delivery/freight; management assumes current surcharges persist, estimating ~70 basis points unfavorable impact on each of Q3 and Q4.

Company Guidance

Management guided Q3 total company sales to grow in the high-single-digit range, with Retail segment comps up mid-single-digits (FP Group high-single-digits, Urban Outfitters mid-single-digits, Anthropologie low- to mid-single-digits), Nuuly revenue in the high-20s, and Wholesale growth in the low-teens (FP Group wholesale called out for mid-teens); they expect Q3 gross profit rate to improve 25–50 basis points year‑over‑year and full‑year GP to be ~25 bps higher, while assuming oil‑surcharge headwinds of roughly 70 bps in each of Q3 and Q4. SG&A is planned to grow below sales in Q3 and in line with or below sales for the full year, inventory is expected to grow at or below sales in Q3, and the adjusted tax rate is targeted at ~24.75% for Q3 and FY‑27. Capital expenditures for FY‑27 are planned at about $475 million (≈35% retail, 50% logistics, 15% technology/home office), the company plans roughly 54 store openings and 18 closures (net ~36; including ~21 FP Movement, 12 Free People, 12 Anthropologie and 8 Urban Outfitters), and Nuuly is expected to exceed $700 million in FY‑27 revenue with a high‑single‑digit operating profit rate.

Urban Outfitters Financial Statement Overview

Summary

Strong profitability and multi-year margin expansion (TTM gross margin ~36%, EBIT margin ~9.6%, ROE ~17.6%) support a high score. Offsetting factors are decelerating TTM revenue growth, moderate leverage with sizable absolute debt (~$1.21B), and mixed/volatile cash conversion (TTM FCF ~$318M vs. OCF ~$716M; FCF only ~half of net income).

Income Statement

82Very Positive

Balance Sheet

74Positive

Cash Flow

66Positive
Financial statement breakdown
BreakdownTTMJan 2026Jan 2025Jan 2024Jan 2023Jan 2022
Income Statement
Total Revenue6.47B6.17B5.55B5.15B4.80B4.55B
Gross Profit2.43B2.22B1.93B1.73B1.43B1.49B
EBITDA851.12M725.43M621.67M491.76M324.93M511.41M
Net Income569.06M464.92M402.46M287.67M159.70M310.62M
Balance Sheet
Total Assets5.12B5.01B4.52B4.11B3.68B3.79B
Cash, Cash Equivalents and Short-Term Investments716.13M695.93M610.43M465.06M382.64M446.00M
Total Debt1.21B1.23B1.10B1.08B1.12B1.19B
Total Liabilities2.27B2.19B2.05B2.00B1.89B2.05B
Stockholders Equity2.85B2.82B2.47B2.11B1.79B1.75B
Cash Flow
Free Cash Flow295.21M315.02M320.25M309.79M-56.78M96.89M
Operating Cash Flow715.89M575.19M502.83M509.41M142.73M359.32M
Investing Cash Flow-110.11M-311.65M-308.77M-521.65M-32.01M-487.66M
Financing Cash Flow-340.67M-191.37M-77.11M-12.13M-118.40M-60.27M

Urban Outfitters Technical Analysis

Technical Analysis SentimentPositive
Last Price90.72

Price Trends

50DMA80.86Positive
100DMA77.34Positive
200DMA73.09Positive

Market Momentum

MACD3.20Negative
RSI66.05Neutral
STOCH71.55Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For URBN, the sentiment is Positive. The current price of 90.72 is above the 20-day moving average (MA) of 86.02, above the 50-day MA of 80.86, and above the 200-day MA of 73.09, indicating a bullish trend. The MACD of 3.20 indicates Negative momentum. The RSI at 66.05 is Neutral, neither overbought nor oversold. The STOCH value of 71.55 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for URBN.

Urban Outfitters Risk Analysis

Urban Outfitters disclosed 26 risk factors in its most recent earnings report. Urban Outfitters reported the most risks in the "Finance & Corporate" category.

Higher RiskSector Avg.Lower RiskFinance & CorporateTech & InnovationLegal & RegulatoryProductionAbility to SellMacro & Political
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added

1 New Risk
1.There have been no material changes in our risk factors since January 31, 2026. Please refer to our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, filed with the SEC on April 1, 2026, for our risk factors.Q2, 2026

Urban Outfitters Peers Comparison

Overall Rating

UnderperformOutperform
Sector (61)

Financial Indicators

URBN against its peers
NameOverall RatingMarket CapP/E RatioROEDividend YieldRevenue GrowthEPS Growth
ANFANF81Outperform$6.98B13.8539.59%―4.73%8.69%
URBNURBN79Outperform$7.77B13.9620.72%―11.01%24.97%
AEOAEO72Outperform$3.29B9.8020.04%2.55%8.21%89.24%
GAPGAP69Neutral$7.84B6.5333.13%3.09%1.05%44.82%
Sector *61Neutral$18.38B12.79-2.54%3.03%1.52%-15.83%
BKEBKE61Neutral$2.39B10.5946.91%9.49%6.22%8.74%

* Consumer Cyclical Sector Average

Performance Comparison

0%50%100%URBNANFAEOBKEGAPDec '25Jan '26Feb '26Mar '26Apr '26May '26Jun '26Jul '26Aug '26Sep '26Oct '26
URBN and its peers over the selected period
Show on chartTickerCompany NamePriceChange% Change
URBNUrban Outfitters90.7228.7146.30%
ANFAbercrombie & Fitch Company164.4494.29134.41%
AEOAmerican Eagle Outfitters19.613.5021.73%
BKEThe Buckle Inc.46.38-4.26-8.41%
GAPGap, Inc.22.320.180.82%

Urban Outfitters Corporate Events

Business Operations and StrategyFinancial Disclosures

Urban Outfitters Reports Record Quarterly Sales and Profits

Positive
Aug 27, 2026

Urban Outfitters reported record results for the quarter and six months ended July 31, 2026, with quarterly net income of $240.7 million, earnings of $2.78 per diluted share and total net sales up 10.4% to $1.66 billion. Adjusted net income for the q...

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Aug 27, 2026