:max_bytes(150000):strip_icc()/GettyImages-2033002427-ced52b753cd04d489068992b8d21a761.jpg "Urban Outfitters Stock Falls After Jefferies Downgrade as Retailer’s Foot Traffic Slows")
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Key Takeaways
- Urban Outfitters shares decline after Jefferies warned about slowing foot traffic at the clothing and shoe retailer.
- Jefferies cut its rating on the stock to Underperform from Hold, and reduced the price target by $10 to $32.
- Analyst Corey Tarlowe said along with declining foot traffic, Urban Outfitters faced promotional pressures and more competition.
Shares of clothing and shoe retailer Urban Outfitters (URBN) dropped over 3% in intraday trading Wednesday following a downgrade from Jefferies, which warned about a slowdown in shoppers going to Urban Outfitters stores.
Jefferies lowered its rating on the stock to “underperform” from “hold,” and lowered the price target to $32 from $42.
Analyst Corey Tarlowe wrote that there has been “a notable deceleration” in rolling three-month foot traffic at its Urban Outfitters, Anthropologie, and Free People locations. He noted that while the firm’s core brands have benefited from recent emerging fashion trends, “the stock could face short-term headwinds as core Urban Outfitters’ turnaround is likely bumpy, and growth at Anthropologie & Free People appears to be moderating.”
Tarlowe added that the company also faced promotional pressures and increased competition. He pointed to increased foot traffic at the stores of rival Gap (GPS) and the potential loss of market share.
Shares of Urban Outfitters were down 3.2% at $36.81 as of about 2 p.m. ET Wednesday. Despite Wednesday’s losses, shares of Urban Outfitters remained higher for 2024. They’ve gained close to 3% since the start of the year.
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