Urban Outfitters shares gain the most in 14 weeks on Wednesday, D.A. Davidson upgrades stock to “Buy”, sees margin improvement

D.A. Davidson on Wednesday revised up its rating on Urban Outfitters Inc (URBN) from “Neutral” to “Buy” and also boosted its price target on the stock from $30 to $36, as the firm cited an improving margin profile.

Urban Outfitters shares closed higher for an eighth consecutive trading session on NASDAQ on Wednesday. It has also been the sharpest daily surge since December 26th 2018. The stock went up 3.62% ($1.11) to $31.77, after touching an intraday high at $31.99, or a price level not seen since February 1st ($32.48).

Shares of Urban Outfitters Inc have retreated 4.31% so far in 2019, following another 5.31% drop in 2018.

In a research note called Davidson Datamining, analyst John Morris said that the gathered data reflected the retailers “green shoots in improving pricing architecture at the Anthropologie division with stronger pricing and lower markdown cadence at the Urban division.”

“The modest, but high quality growth potential, wrapped in the clearer path to margin turnaround, makes this story attractive given the companys current depressed valuation,” the analyst noted.

D.A. Davidsons Morris also wrote that Urban Outfitters Inc was “still in the early phases of an improving margin profile driven by upside potential”.

According to CNN Money, the 17 analysts, offering 12-month forecasts regarding Urban Outfitters Inc’s stock price, have a median target of $34.00, with a high estimate of $50.00 and a low estimate of $29.00. The median estimate represents a 7.02% upside compared to the closing price of $31.77 on April 3rd.

The same media also reported that 15 out of 22 surveyed investment analysts had rated Urban Outfitters Inc’s stock as “Hold”, while 6 – as “Buy”.

Weekly Pivot Levels

By using the traditional method of calculation, the weekly levels of importance for Urban Outfitters Inc (URBN) are presented as follows:

Central Pivot Point – $29.03
R1 – $30.45
R2 – $31.27
R3 – $32.69
R4 – $34.12

S1 – $28.21
S2 – $26.79
S3 – $25.97
S4 – $25.16