Urban Outfitters downgraded by Jeffries over slowing traffic

Apparel retailer Urban Outfitters (URBN) has received a downgrade from Jefferies, with the firm lowering its rating on the stock to Underperform from Hold. The key driver behind Jefferies' decision is its growing concern over slowing traffic at Urban Outfitters stores, which it attributes to increased competition in the retail sector.

Jefferies also lowered its price target on the stock to $32 per share from $42.

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This post was written by Angel Smith

Video transcript

[AUDIO LOGO]

- We got some Calls of the Day now for you. Let's start with Urban Outfitters. Jefferies downgrading the stock to underperform, citing risk to shares of the company, based on slowing traffic data. This was an interesting note coming from the team over there. Corey Tarlowe, Randy Konik, et cetera, and those guys talking about increasing competition and losing market share from Urban Outfitters from the likes of Shein, of course, the Chinese company, as well as Abercrombie. And even, I thought this was interesting, even mentioning Old Navy and GAP, as gaining some traffic numbers.

- Yeah. So acceleration and trends at some competitors mentioned Abercrombie, Old Navy, GAP stores. But on Urban Outfitters, says we see recovery to flat comps by Q4 as bumpy. New leadership appointments help, the analysts saying, but market share shifts likely to remain sticky. He's pointing out Abercrombie, for example, has been gaining share. Stock is down today basically flat so far this year. In terms of the Street, three buys, nine holes, and now officially one bear over at Jefferies.

- Yes, the lone one.

- The lone one. Doesn't mean he's wrong.