Urban Outfitters (URBN) came out with quarterly earnings of $0.88 per share, beating the Zacks Consensus Estimate of $0.81 per share. This compares to earnings of $0.40 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 8.64%. A quarter ago, it was expected that this clothing and accessories retailer would post earnings of $0.89 per share when it actually produced earnings of $1.10, delivering a surprise of 23.60%.

Over the last four quarters, the company has surpassed consensus EPS estimates three times.

Urban Outfitters, which belongs to the Zacks Retail – Apparel and Shoes industry, posted revenues of $1.28 billion for the quarter ended October 2023, surpassing the Zacks Consensus Estimate by 1.61%. This compares to year-ago revenues of $1.18 billion. The company has topped consensus revenue estimates four times over the last four quarters.

The sustainability of the stock’s immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management’s commentary on the earnings call.

Urban Outfitters shares have added about 54.6% since the beginning of the year versus the S&P 500’s gain of 18.4%.

What’s Next for Urban Outfitters?

While Urban Outfitters has outperformed the market so far this year, the question that comes to investors’ minds is: what’s next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company’s earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Urban Outfitters: mixed. While the magnitude and direction of estimate revisions could change following the company’s just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is $0.77 on $1.46 billion in revenues for the coming quarter and $3.23 on $5.11 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail – Apparel and Shoes is currently in the bottom 30% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

One other stock from the same industry, Genesco (GCO), is yet to report results for the quarter ended October 2023. The results are expected to be released on December 1.

This seller of footwear, hats, clothing and accessories is expected to post quarterly earnings of $0.83 per share in its upcoming report, which represents a year-over-year change of -49.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days.

Genesco’s revenues are expected to be $582.98 million, down 3.5% from the year-ago quarter.

Top 5 ChatGPT Stocks Revealed

Zacks Senior Stock Strategist, Kevin Cook names 5 hand-picked stocks with sky-high growth potential in a brilliant sector of Artificial Intelligence. By 2030, the AI industry is predicted to have an internet and iPhone-scale economic impact of $15.7 Trillion.

Today you can invest in the wave of the future, an automation that answers follow-up questions … admits mistakes … challenges incorrect premises … rejects inappropriate requests. As one of the selected companies puts it, “Automation frees people from the mundane so they can accomplish the miraculous.”

Download Free ChatGPT Stock Report Right Now >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Urban Outfitters, Inc. (URBN) : Free Stock Analysis Report

Genesco Inc. (GCO) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Original: Investing Feed: Urban Outfitters (URBN) Surpasses Q3 Earnings and Revenue Estimates