Sunday, October 02, 2005

Urban Outfitters: Current Price a Mere Way Station

Teen-focused clothing retailer Urban Outfitters was the subject of Sunday's research note.

URBN belongs to that rarified group of fast growers ostracized by valuation-obsessed bears.

As long as a company is growing its earnings as fast as Urban is, we're more than happy to pay the high multiple.

Urban Outfitters, which carries a relatively large market cap for such a young company, plans to open roughly 30 stores over the next 12 months.

URBN's rocking numbers come from their attractive demographic: concept-driven twentysomethings with money to spend.

Think Manhattan studio worm seeking chic futon.

Besides the income statement and management's "candor with the comps," we're excited about the technicals.

URBN has pulled back into a base after throwing investors a stock split.

If earnings -- due out 11/4 -- surprise the Street, we should see this niche wonder climb back to its 52 week high.

Torrid growth seems to be URBN's middle name.

Buy rating on URBN with a $34 price target.

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