Wedbush analyst Betty Chen published a report on Urban Outfitters URBN that maintains its Neutral rating and $42 price target.
Wedbush reported that, “In particular, management alluded to Q1
QTD sales running similar to Q4's level, which is impressive considering
macroeconomic weakness and unfavorable weather. That said, the rapidly
growing lower-margin web products (as limited quantity obscures IMU), along with
higher delivery expenses is pressuring gross margin, leading to guidance for “at
least +50 bps in gross margin expansion this year, below consensus outlook for at
least +110 bps. Management continues to believe that gross margin can retrace
historical peaks of ~41% (vs. 36.9% in F12) though timing remains uncertain.”
Shares of urban outfitters closed at $41.50 on Monday.
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