Latest news with #UrbanOutfitters
Miami Herald
7 hours ago
- Business
- Miami Herald
Nike turns to unexpected brand in desperate bid to win back Gen Z
One brand reps LeBron, Serena, and Olympic gold. The other sells corduroy fanny packs and mushroom lamps. Raise your hand if you never thought you'd associate Nike with Urban Outfitters On paper, they live in completely different universes - one powered by performance, the other by personality. Nike is about greatness. Urban is about vibes. Don't miss the move: Subscribe to TheStreet's free daily newsletter And yet, here we are. Because when a brand starts slipping with the generation it once ruled, strange things happen. Related: Nike, Adidas face rising threat on the golf course Nike has been showing cracks. Once the default for teens, the brand's influence has started to fade. Gen Z is drifting toward streetwear, niche performance labels, and brands that feel more in tune with their identity than with big sponsorship deals. Meanwhile, Urban Outfitters has something Nike needs right now: cultural relevance with young people. Not tastemakers. What do you do when your brand starts feeling out of touch? You partner with someone who still has the juice. And that's exactly what Nike just did. Urban Outfitters The new concept is called On Rotation, and it has already launched inside select Urban Outfitters locations in New York, D.C., Scottsdale, San Diego, and Manhattan Beach. Each space is designed like a lounge, not a locker curated product drops, low lighting, and a discovery-first layout. Nike is the first featured brand. The activation includes more than 150 pieces of Nike apparel and footwear, available both in-store and online. not just about selling hoodies and Dunks. This is a larger play to recapture Gen Z's attention and, maybe more importantly, its respect. Related: Lululemon scores a huge victory over Nike Urban Outfitters says future On Rotation partnerships will feature fashion, lifestyle, and design brands that speak to Gen Z values. For now, Nike gets the full spotlight. "Urban Outfitters has always been a destination for discovery, especially for Gen Z," said Cyntia Leo, head of brand marketing. "Nike is the ideal first partner… their cultural credibility is unmatched." Except, that last part might not be true anymore. This isn't just a team-up. It's a test. Can Nike blend into culture again? Whether Gen Z actually buys in is the question nobody can answer yet. Nike's dominance isn't gone, but it's fragile. Nike is (obviously) still widely recognized, but its grip on younger consumers isn't what it used to be. Young shoppers are turning toward brands like New Balance, Hoka, and On - labels that mix cool with credibility and don't feel like they're trying so hard. Nike, on the other hand, is starting to try. The brand fumbled its wholesale strategy by pulling back too much, too fast. Its direct-to-consumer numbers have slipped. According to the latest Q3 earnings report, Nike's 2025 third quarter revenue dropped 9%, with direct revenues down 12% and wholesale revenues down 7% Even the CEO admitted Nike needs to rebuild wholesale relationships, a sign of strategic retreat, not confidence. On Rotation isn't just a retail concept - it's a rehab attempt. Nike is trying to borrow cultural clout from a retailer that still connects with Gen Z. Urban Outfitters might not sell out arenas, but it knows how to fill a For You page. This move could help Nike find its footing again. Or it could prove what younger shoppers already suspect: the Swoosh just isn't that cool anymore. Related: Nike delivers bad news for customers The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
3 days ago
- Business
- Yahoo
Urban Outfitters Seeing Inflows
URBN sells clothing through three primary channels: retail, wholesale, and subscription. It operates through multiple brands, including Urban Outfitters, Anthropologie, BHLDN, Free People, Terrain, and Nuuly. URBN's focus on customer acquisition, operational efficiency, and digital innovation has driven significant growth. In fact, the company is planning to open 64 new stores this fiscal year, while closing 17 stores. As for earnings, URBN's first-quarter fiscal 2026 report reflected record-breaking quarterly sales of $1.3 billion, which is an 11% gain. URBN produced a 20% increase in gross profit ($489 million). Additionally, every brand the company manages delivered positive annual comparable sales, with four brands posting record sales. The Nuuly brand grew by 60% and added 110,000 subscribers over the prior year. It's no wonder URBN shares are up 32% this year – and they could rise more. MoneyFlows data shows how Big Money investors are betting heavily on the forward picture of the stock. Institutional volumes reveal plenty. In the last year, URBN has enjoyed strong investor demand, which we believe to be institutional support. Each green bar signals unusually large volumes in URBN shares. They reflect our proprietary inflow signal, pushing the stock higher: Plenty of discretionary names are under accumulation right now. But there's a powerful fundamental story happening with Urban Outfitters. Institutional support and a healthy fundamental backdrop make this company worth investigating. As you can see, URBN has had strong sales and earnings growth: 3-year sales growth rate (+6.9%) 3-year sales EPS rate (+25%) Source: FactSet Also, EPS is estimated to ramp higher this year by +9.6%. Now it makes sense why the stock has been powering to new heights. URBN has a track record of strong financial performance. Marrying great fundamentals with our proprietary software has found some big winning stocks over the long term. Urban Outfitters has been a top-rated stock at MoneyFlows. That means the stock has unusual buy pressure and growing fundamentals. We have a ranking process that showcases stocks like this on a weekly basis. It's made the rare Outlier 20 report multiple times in the last year. The blue bars below show when URBN was a top pick…boosted by Big Money inflows: Tracking unusual volumes reveals the power of money flows. This is a trait that most outlier stocks exhibit…the best of the best. Big Money demand drives stocks upward. The URBN rally isn't new at all. Big Money buying in the shares is signaling to take notice. Given the historical gains in share price and strong fundamentals, this stock could be worth a spot in a diversified portfolio. Disclosure: the author holds no position in URBN at the time of publication. If you are a Registered Investment Advisor (RIA) or are a serious investor, take your investing to the next level and follow our free weekly MoneyFlows insights. This article was originally posted on FX Empire The Exodus From Safe Havens Outlier Money Flows Lift Insulet Monster's Comeback Continues Big Money Buys LPL Financial Shares US Public Debt Trajectory and Interest Payments Set to Worsen and Exceed Sovereign Peers Big Money Keeps Buying Palantir Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
3 days ago
- Business
- Yahoo
Market Hangover Beckons for Gen Z Darling Urban Outfitters (URBN)
Urban Outfitters (URBN) is bucking the trend. The retail company that targets younger demographics is posting record revenue and cash generation amid an environment characterized by low consumer confidence. A closer look reveals that the company is making inroads with 'Gen Z,' and it's not just its clothes getting the attention. Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter However, with its stock up 80% in the last year, I believe the market has fully priced in Urban's renewed potential in a fiercely competitive retail clothing industry. This makes me cautiously neutral on URBN going forward. Earlier this month, Urban Outfitters reported its first-quarter earnings for the period ending April 30, posting record sales and a net income of $108.3 million. A major driver of this growth is Nuuly, the company's rapidly expanding clothing rental brand. Nuuly's revenue surged from $77.9 million in Q1 2024 to $124.4 million in Q1 2025. The concept is both innovative and timely: for $98 per month, customers, primarily women, can rent a curated selection of apparel, mostly from Urban's own brands. They wear the items for a month, then return them—no commitment required. It's essentially an ever-rotating wardrobe, aligning perfectly with Gen Z's preference for sustainable consumption. From a business perspective, Nuuly is a clever play. It introduces a recurring revenue stream into an industry traditionally dependent on one-time purchases. Each garment can generate revenue multiple times before showing signs of wear, dramatically increasing its lifetime value. Additionally, Nuuly provides Urban with real-time data on style preferences and emerging trends—insights that are impossible to glean from conventional retail sales alone. In short, the rental economy is gaining traction in the fashion world, and Nuuly is positioning Urban Outfitters as a frontrunner in this growing space. Nuuly is just one piece of Urban Outfitters' broader strategy to connect with younger consumers. But it's not only the products that appeal to Gen Z—it's the experience. The company has recently doubled down on immersive retail, reimagining its stores as more than just shopping destinations. A standout example is its collaboration with Nike on 'On Rotation,' an initiative that turns retail spaces into rotating, theme-driven discovery hubs. The goal: make each visit feel fresh, engaging, and uniquely memorable. Beyond Nuuly, Urban's other brands are also performing well. Anthropologie and Free People posted roughly 8% growth in the first quarter, while FP Movement—a sub-brand focused on activewear—delivered an impressive 25% growth in its retail segment. These gains are helping to offset stagnation in the core Urban Outfitters brand. That said, Urban's valuation is starting to look a bit stretched. The stock is trading at an all-time high, and its Price-to-Earnings (P/E) ratio of 15.1 sits slightly above the retail sector median. While macroeconomic pressures haven't significantly impacted the business so far, Urban remains exposed to broader risks like inflation, geopolitical trade tensions, and weak consumer sentiment. If economic conditions deteriorate, discretionary spending—especially on non-essential services like a Nuuly subscription—could be among the first to go. However, the elephant in the room is competition. URBN is caught between fast-fashion heavyweights like Shein and H&M, who offer similar styles at lower prices, and premium brands at the higher end of the market. That leaves Urban targeting a price-sensitive Gen Z audience that's accustomed to affordability without sacrificing style. Meanwhile, the company's turnaround efforts are still in the early stages. Revitalizing its core Urban Outfitters brand and scaling Nuuly profitably will be critical. Any misstep in execution could weigh heavily on the stock. On Wall Street, URBN sports a Moderate Buy consensus rating based on five Buy, six Hold, and one Sell ratings in the past three months. URBN's average price target of $70.50 implies a downside potential of 3% in the next twelve months. Earlier this month, Bank of America Securities analyst Lorraine Hutchinson rated URBN a Buy with a price target of $80. She highlighted international expansion and Nuuly as key growth opportunities. Moreover, 'Anthropologie and Free People continue to see strong sales growth, with Anthropologie benefiting from increased store and online traffic and Free People expanding through new store openings.' Urban's recent financial performance marks the early stages of a promising turnaround. The company is making meaningful progress with its target demographic, thanks in large part to innovative offerings like Nuuly. This subscription-based model has opened a valuable new revenue stream while positioning Urban for long-term growth. And while the Urban Outfitters brand continues to lag, other segments—such as Anthropologie and FP Movement—present encouraging near-term momentum. That said, much of this optimism is already reflected in the stock's price. Valuation reflects high expectations, and several risks could disrupt the company's trajectory. Macroeconomic pressures—ranging from tariffs to shifts in consumer spending—could weigh on both margins and growth. Moreover, fashion is inherently fickle; any of Urban's brands could quickly fall out of favor, much like the namesake label has. All things considered, the most prudent move may be to hold. This isn't the time to chase the rally, but it may also be premature to cash out. 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Yahoo
5 days ago
- Business
- Yahoo
Urban Outfitters Spurns Air for Ocean Freight as Tariffs Settle in
Urban Outfitters is taking on tariffs by shifting its primary mode of cargo transportation from air freight to ocean freight, cutting a major cost in its inbound logistics network. Even as trans-Pacific ocean freight rates have accelerated since the Trump administration's 145-percent tariffs on Chinese imports were scaled back for 90 days, ocean freight is generally significantly cheaper than air freight. As of September 2024, Drewry Airfreight Insights calculated that air cargo costs 5.6 times more to ship than its oceangoing counterpart. More from Sourcing Journal Trump Threatens EU With 50% Duties, Says Trade Talks 'Going Nowhere' April Retail Sales Were Rocky, in Line With Tariff Turmoil Trans-Pacific Cargo Space Vanishing Fast Ahead of Tariff Deadlines The air-to-sea conversion would protect margins, but won't come without its drawbacks. Urban Outfitters CEO and president Dick Hayne said the ocean-bound voyage adds about 30 days to delivery times. It remains unclear what percentage of cargo Urban Outfitters moves via ocean with the switch, or if the retailer has stopped shipping via air entirely. Sourcing Journal reached out to Urban Outfitters. 'There is always a risk as you go out in time that the fashion might not be as accurate as we would like it to be,' Hayne acquiesced in the Wednesday first-quarter earnings call, noting that the company is trying shorten that time period via merchandise planning and inventory management technologies. To account for the 30 extra days at sea, the lifestyle apparel retailer is planning to bring in fall product earlier in the second quarter. 'While there is some fashion risk of bringing product in early, we believe that it is prudent planning to bring in fall inventory—which is less sensitive to fashion—early, given the uncertain tariff outlook and any potential supply chain disruptions that could occur in the future,' said Urban Outfitters' chief financial officer Melanie Marein-Efron. With that in mind, Marein-Efron noted that the Anthropologie and Free People parent would likely see inventory growth ahead of sales growth in Q2. The shift runs counter to moves the retailer made during the Covid-19 pandemic, when supply chain congestion snarled activity at seaports worldwide. During the late-summer peak shipping season in 2021, the retailer pivoted to bring most of its inventory from Vietnam into the U.S. via air freight. This was due to the port congestion alongside record-high ocean spot freight rates that swelled north of $10,000 per container in September that year, according to the Drewry World Container Index (WCI). As of Friday, the average container costs $2,276. According to co-president and chief operating officer Frank Conforti, the company is also mitigating tariffs in ways similar to its retail counterparts: shifting countries of origin where possible, negotiating better terms with vendors and sparingly raising prices. The retailer is already well-hedged against the higher tariffs levied on China, with the country representing less than 5 percent of worldwide production. India, Vietnam, and Turkey are the retailer's three largest countries of origin, with no single country accounting for more than 25 percent of production. 'Over the last several years the teams have worked hard to diversify our countries of origin as well as dual source most of our own brand products,' said Conforti. 'This means many of our products are made in two different origins, enabling us to shift production from one country to another if needed.' Urban Outfitters had a strong first quarter in the face of the tariff concerns, with net sales jumping 10.7 percent to a record $1.3 billion. The retailer also generated a record $108.3 million. But the forward-looking projections for margins were a promising sign for the business, with the company expecting to achieve 50 to 100 basis points of gross margin improvement for the fiscal year. Stock has jumped more than 22 percent since the Wednesday earnings call. Urban's shift to ocean freight reflects a wider trend as more companies scramble to import cargo into the U.S. ahead of the July 9 country-specific tariff deadline and the Aug. 14 China duty deadline. For the week ending May 12, U.S. import bookings expanded 48.5 percent from the week prior, according to data from container tracking platform provider Vizion. But with the flood of cargo back on the oceans, a shortage of capacity is already rearing its head across container shipping. Multiple freight forwarders have indicated that additional space isn't expected to open until June, as shippers also sought to get ahead of peak season surcharges and general rate increases (GRIs) set to be implemented that month. Earlier this week, American Shipping Company told customers that booking requirements are now at a minimum of three to four weeks before the target vessel sailing date. Maritime trade advisory service Sea-Intelligence issued warnings Thursday that in the immediate future, 'there is not yet a meaningful injection' of new capacity on trans-Pacific trade to the North American West Coast. 'This development, or lack thereof, to the West Coast becomes even more noteworthy in the face of the development to the East Coast, where it does appear that there is already some attempt to increase capacity, relative to a week ago,' said Alan Murphy, CEO of Sea-Intelligence, in the weekly update. According to Sea-Intelligence, there is a continuing year-over-year reduction in ocean freight capacity to both coasts until the start of June, before the West Coast availability tapers off again throughout the month. 'The West Coast only sees a meaningful increase from mid-July, whereas the East Coast sees a significant capacity growth from end-June,' Murphy said. 'But this is still very late for a capacity increase, if there is an imminent surge of cargo from China.' Sign in to access your portfolio
Yahoo
6 days ago
- Business
- Yahoo
American Eagle (AEO) Q1 Earnings Report Preview: What To Look For
Young adult apparel retailer American Eagle Outfitters (NYSE:AEO) will be reporting results tomorrow after the bell. Here's what you need to know. American Eagle met analysts' revenue expectations last quarter, reporting revenues of $1.60 billion, down 4.4% year on year. It was a satisfactory quarter for the company, with a solid beat of analysts' EBITDA estimates. Is American Eagle a buy or sell going into earnings? Read our full analysis here, it's free. This quarter, analysts are expecting American Eagle's revenue to decline 4.4% year on year to $1.09 billion, a reversal from the 5.8% increase it recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.22 per share. Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. American Eagle has missed Wall Street's revenue estimates five times over the last two years. Looking at American Eagle's peers in the apparel and footwear retail segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Urban Outfitters delivered year-on-year revenue growth of 10.7%, beating analysts' expectations by 2.5%, and Boot Barn reported revenues up 16.8%, falling short of estimates by 0.9%. Urban Outfitters traded up 23% following the results while Boot Barn was also up 16.5%. Read our full analysis of Urban Outfitters's results here and Boot Barn's results here. There has been positive sentiment among investors in the apparel and footwear retail segment, with share prices up 11.4% on average over the last month. American Eagle is up 4.5% during the same time and is heading into earnings with an average analyst price target of $12 (compared to the current share price of $11.25). Unless you've been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story.
