Urban Stock Story

URBN
 Stock
  

USD 20.97  0.61  3.00%   

As many millenniums are getting more into consumer cyclical space, we are going to outline Urban Outfitters and Ralph Lauren as potential medium-term trade. We are going to inspect some of the competitive aspects of both Urban and Ralph.
Published over two months ago
View all stories for Urban Outfitters | View All Stories

Should you sell your Ralph Lauren (NYSE:RL) and Urban Outfitters (NASDAQ:URBN) positions after an upsurge?

By analyzing existing fundamental drivers between Urban Outfitters and Ralph, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Ralph with a short position in Urban Outfitters. Check out our pair correlation module for more information.

Let's begin by analyzing the assets.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Urban Outfitters has an asset utilization ratio of 248.19 percent. This suggests that the company is making $2.48 for each dollar of assets. An increasing asset utilization means that Urban Outfitters is more efficient with each dollar of assets it utilizes for everyday operations.

How important is Urban Outfitters's Liquidity

Urban Outfitters financial leverage refers to using borrowed capital as a funding source to finance Urban Outfitters ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Urban Outfitters financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Urban Outfitters's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
It is good to see analyst projects for Urban Outfitters, but it might be worth checking our own buy vs. sell analysis

Exercise or conversion by Mcdonald Wesley S of 00 shares of Urban Outfitters subject to Rule 16b-3

Legal trades by Urban Outfitters insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Urban insider trading alert for exercise of director restricted stock unit by Mcdonald Wesley S, the corporate stakeholder, on 2nd of August 2022. This event was filed by Urban Outfitters Inc with SEC on 2022-06-08. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Breaking down Urban Outfitters Further

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Let me now go over Urban Outfitters revenue. Based on the latest financial disclosure, Urban Outfitters reported 4.55 B of revenue. This is 36.18% lower than that of the Consumer Cyclical sector and significantly higher than that of the Apparel Retail industry. The revenue for all United States stocks is 51.77% higher than that of Urban Outfitters. As for Ralph Lauren we see revenue of 5.98 B, which is much higher than that of the Apparel Retail

Urban4.55 Billion
Sector0.0
Ralph5.98 Billion
4.5 B
Urban
Sector
B
Ralph

How will Urban institutional investors react to the next slide?

Treynor Ratio just dropped to -0.25, may entail upcoming price decrease. Urban Outfitters exhibits very low volatility with skewness of -0.55 and kurtosis of 0.69. However, we advise investors to further study Urban Outfitters technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Urban Outfitters' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Urban Outfitters' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Urban Outfitters Implied Volatility

Urban Outfitters' implied volatility exposes the market's sentiment of Urban Outfitters stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Urban Outfitters' implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Urban Outfitters stock will not fluctuate a lot when Urban Outfitters' options are near their expiration.

Our Bottom Line On Urban Outfitters

Whereas some other firms in the apparel retail industry are either recovering or due for a correction, Urban may not be as strong as the others in terms of longer-term growth potentials. To sum up, as of the 21st of May 2022, we believe that at this point, Urban Outfitters is undervalued with below average odds of financial turmoil within the next 2 years. Our actual 'Buy-vs-Sell' recommendation on the company is Hold.

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Urban Outfitters. Please refer to our Terms of Use for any information regarding our disclosure principles.

Would you like to provide feedback on the content of this article?

You can get in touch with us directly or send us a quick note via email to editors@macroaxis.com