Brean Capital Says Urban Outfitters Has Not Lost Relevance

In a report published Tuesday, Brean Capital analyst Liz Pierce reiterated a Buy rating and $42.00 price target on Urban Outfitters URBN. In the report, Brean Capital noted, "In our opinion, Q4 comp sales results, which accelerated over the 2-month combined Holiday period, demonstrates the power of the URBN brands and that the Urban Outfitters (UO) brand has not lost its relevance with its target customer. While we believe there is still work to be done at the UO division, we have noted ongoing product and merchandise storytelling improvements throughout the quarter. We further believe that Free People (FP) or Anthro continue to have strong consumer attachment to their respective brand/lifestyles, positioning them for market share gains. Accordingly, we believe our investment thesis of each brand is moving in the right direction, i.e. up and to the right, at the same time is on track and therefore, we reiterate our Buy rating and our $42 TP. Our $42 target price is based on a multiple of 22x our FY16 EPS estimate of $1.92 and a 1.1x PEG ratio." Urban Outfitters closed on Monday at $36.51.