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Urban Outfitters (URBN) Q1 Earnings: A Surprise in Store?

Urban Outfitters Inc. URBN is expected to release first-quarter fiscal 2017 results on May 18. The big question facing investors is whether this lifestyle specialty retailer will be able to deliver a positive earnings surprise in the quarter to be reported. In the preceding quarter, this Philadelphia, PA-based company reported earnings beat of 8.9%.

Notably, the company surpassed the Zacks Consensus Estimate in two of the last four quarters, with an average earnings miss of 0.4%. Let’s see how things are shaping up for this announcement.

Zacks Model Shows Unlikely Earnings Beat

Our proven model does not conclusively show that Urban Outfitters is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Urban Outfitters has an Earnings ESP of 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate stand at 25 cents. The company carries a Zacks Rank #3, but an ESP of 0.00% makes surprise prediction difficult.

Factors Influencing this Quarter

Urban Outfitters is a multi-brand and multi-channel retailer with a flexible merchandising strategy. The company also has a significant domestic and international presence with rapidly expanding e-commerce activities. The company remains committed to improve comparable-store sales performance, sustain investments in direct-to-consumer business, enhance productivity in existing channels, add new brands and optimize inventory level.

On the other hand, Urban Outfitters’ exposure to the Canadian and European markets could hurt its bottom-line performance in the quarter to be reported due to foreign currency headwinds. The company’s top line missed the Zacks Consensus Estimate in the trailing four quarters primarily due to soft customer traffic and currency headwinds.

Stocks Poised to Beat Earnings Estimates

Here are some other companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:

Best Buy Co., Inc. BBY, which is scheduled to release earnings on May 24, holds a Zacks Rank #2 and an Earnings ESP of + 2.94%.

DSW Inc. DSW, which is slated to release earnings on May 24, carries a Zacks Rank #3 and an Earnings ESP of + 2.17%.

PVH Corp. PVH, which is set to release earnings on May 25, carries a Zacks Rank #3 and an Earnings ESP of + 1.40%.

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URBAN OUTFITTER (URBN): Free Stock Analysis Report
 
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PVH CORP (PVH): Free Stock Analysis Report
 
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