Urban Outfitters Jumps as Free People Brand Leads Sales Rebound
Urban Outfitters Jumps as Free People Brand Leads Sales Rebound
(Bloomberg) -- Add Urban Outfitters Inc. to the list of retailers getting help from its secondary brands.
The company’s comparable sales rose in the third quarter, led by increases at its Free People and Anthropologie divisions. Urban Outfitters’ namesake brand also expanded, defying analysts’ forecasts for contraction. Shares soared as much as 13 percent in late trading after the report’s release.
Urban Outfitters joins a group of companies that have pulled out of slumps by diversifying across brands -- a development that may spark optimism in a sector that’s struggled to come up with winning formulas this year. Shares of Gap Inc. have risen since it reported sales growth underpinned by its Old Navy discount chain, while Abercrombie & Fitch Co. saw same-store sales expand for the first time in seven quarters, thanks to rapid growth at its Hollister brand.
Total comparable sales rose 1 percent at Urban Outfitters, compared with an estimate for a decline of 4.5 percent, according to Consensus Metrix. All three of the company’s brands exceeded expectations. Profit of 41 cents a share also outpaced the average forecast of 33 cents from analysts.
The shares rose to as high as $32 in late trading. They have fallen 0.7 percent in 2017 through Monday’s close.
To contact the reporter on this story: Jonathan Roeder in Mexico City at jroeder@bloomberg.net.
To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net.
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