Urban Outfitters Drops as Sequins & Velvet Can't Trump PJs
By Christiana Sciaudone
Investing.com -- Urban Outfitters (NASDAQ:URBN) tumbled despite topping profit and sales estimates.
Third quarter same-store sales slipped 1.8%, and management said on a call that the fourth quarter is looking similar to the third.
Shares are down about 3%.
Americans are hunkering down at home again after Covid-19 numbers surge, with more than 12.5 million people infected and almost 259,000 dead. Cities and states around the country have mandated shutdowns, once again. New York will implement vehicle checkpoints at key bridges and crossings, and will strictly enforce a travel quarantine, Bloomberg reported.
That leaves little opportunity to don Anthropologie's charming dresses or Urban Outfitter's sequin shifts to galas and holiday parties. But you have to give them credit. Urban Outfitters is shilling the party garb as daily evening wear, encouraging wearers to "make every night feel like a party." I think we'll stick with our PJs.
The company reported third quarter earnings per share of 78 cents that beat the expected 44-cent profit on sales of $969 million, higher than the estimated $930 million.
"Total retail segment comp sales for November to date are essentially flat with our Q3 comp level," said Chief Executive Officer Richard Hayne on an earnings call on Nov. 23. "Store traffic and comps have softened slightly over the last few weeks."
Hayne said digital demand has improved and is offsetting weaker store sales.
Until Covid-19 is over "and the stores are continued challenged, I would suggest that the direct business will remain very elevated, the carriers will all have a problem fulfilling that volume and will continue to charge more," Hayne said.
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