Urban Outfitters (URBN) reported better-than-expected Q3 earnings late Monday, while Abercrombie & Fitch (ANF) and American Eagle Outfitters (AEO) report early Tuesday. But URBN stock plunged from a buy zone overnight, while ANF stock tumbled and AEO reversed to close higher.
URBN, ANF and AEO stock each rose on Monday.
Black Friday is just around the corner, but apparel retailers have already begun offering enticing deals to get shoppers to buy early and often.
Apparel retailers like Urban Outfitters, Abercrombie & Fitch and American Eagle can expect to have more in-person shoppers as the vaccine rollout has allowed stores to reopen to full capacity.
But they’ll still be relying heavily on online channels bolstered during the pandemic, as shoppers have grown more comfortable buying clothes online.
Meanwhile, supply-chain issues could limit inventories and fuel cost increases, as demand is likely to spike during the holiday shopping season.
Urban Outfitters Earnings
Estimates: FactSet analysts expected Urban Outfitters earnings of 84 cents a share, 8% above the year-ago quarter, on a 16% increase in sales to $1.12 billion. Same-store sales were seen rising 14.4% vs. 2019, according to Consensus Metrix. The comparison to 2019 is made to reflect a more typical year that didn’t include the massive store closures during the pandemic in 2020.
Results: Urban Outfitters earnings rose 14% to 89 cents a share. Sales climbed 16.5% to $1.13 billion, both above estimates.
Same-store sales rose 14.6% vs. the same period in 2019, driven by double-digit growth in online sales, the company said in a statement. But in-store comps declined amid weak store traffic.
“Retail segment comp sales accelerated each month in the quarter, fueled by strong double-digit digital sales, which more than offset negative comp store sales,” said COO Francis John Conforti in an earnings call.
Urban Outfitters operates namesake stores as well as others including Anthropologie and Free People.
“We are excited that November comp sales to date for all brands have accelerated from their Q3 rate,” said CEO Richard Hayne.
Shares tumbled 9.3% to 33.80 on the stock market today. URBN stock had climbed 3% Monday to 37.27, which at the time was in buy range from a cup-with-handle buy point of 36.60, according to MarketSmith. The buy zone extends to 38.43.
URBN stock’s relative strength line is ticking upward. Its RS Rating is 61 out of a possible 99, while its EPS Rating is 57.
Abercrombie & Fitch Earnings
Estimates: Wall Street forecasted Abercrombie & Fitch earnings would fall 13% to 66 cents, while sales would pick up 9.2% to $895.2 million. FactSet saw comps growing 9.7% from the year-ago period.
Results: Abercrombie & Fitch earnings per share unexpectedly rose to 86 cents a share. Revenue grew 10.4% to $905 million. Digital sales rose 8% from last year, representing 46% of total Q3 sales and surged 55% vs. pre-COVID 2019 third-quarter digital net sales.
The board also OK’d a $500 million ANF stock buyback.
ANF stock slumped 12.6% to 41.11 on Tuesday. On Monday, shares rose 4.1% to 46.94. Abercrombie & Fitch stock has a high-handle buy point of 49.07, just above its 52-week best of 48.97 set Nov. 5.
American Eagle Earnings
Estimates: Analysts saw American Eagle earnings per share surging 74% to 61 cents and sales growing 19% to $1.23 billion. Same-store sales were seen rising 19.1%.
Results: American Eagle Outfitters earnings per share came in at 76 cents with revenue up 23% to $1.27 billion.
AEO stock sank 3% Tuesday morning, but rebounded to close 4.7% higher to 28.76. Shares rose 2% to 27.46 on Monday. American Eagle stock recently regained its 50-day line but is well below its 200-day.
Follow Adelia Cellini Linecker on Twitter @IBD_Adelia.
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