Here's What's Driving Urban Outfitters More Than 16% Lower Wednesday
Shares of Urban Outfitters (NASDAQ: URBN), an apparel and home-goods retailer with stores under multiple brands, dropped more than 16% Wednesday morning after a disappointing third quarter left financial results short of estimates on the top and bottom lines.
Sales increased 1.4% to $987 million in the third quarter, compared to the prior year's $974 million result, which fell short of analysts' estimates that called for $1 billion. Earnings per share checked in at $0.56, which narrowly missed analysts' estimates by $0.01 per share. Another disappointing result was found in gross profit margin, which decreased by 217 basis points to 32.5%, compared to the prior year.
Another mixed result that could be sending warning signals to investors was that although there was a 3% increase in comparable retail sales, it was driven by the digital channel. That offset negative retail store comps, and brick-and-mortar sales continue to struggle across much of the industry. "Looking ahead to Q4, we're encouraged by positive sales-to-date but realize our highest volume days have yet to be written," said Richard A. Hayne, chief executive officer, in a press release.
Source Fool.com
