Despite its impressive fundamentals, NASDAQ:URBN remains undervalued.

URBAN OUTFITTERS INC (NASDAQ:URBN) is a hidden gem identified by our stock screening tool, featuring undervaluation and robust fundamentals. NASDAQ:URBN showcases decent financial health and profitability, coupled with an attractive price. Let's dig deeper into the analysis.

Valuation Examination for NASDAQ:URBN

ChartMill assigns a Valuation Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing different valuation elements, such as price to earnings and free cash flow, both in absolute terms and relative to the market and industry. In the case of NASDAQ:URBN, the assigned 8 reflects its valuation:

• URBN is valuated reasonably with a Price/Earnings ratio of 10.50.
• Based on the Price/Earnings ratio, URBN is valued cheaper than 85.95% of the companies in the same industry.
• The average S&P500 Price/Earnings ratio is at 31.73. URBN is valued rather cheaply when compared to this.
• A Price/Forward Earnings ratio of 9.39 indicates a reasonable valuation of URBN.
• URBN's Price/Forward Earnings ratio is rather cheap when compared to the industry. URBN is cheaper than 83.47% of the companies in the same industry.
• When comparing the Price/Forward Earnings ratio of URBN to the average of the S&P500 Index (22.71), we can say URBN is valued rather cheaply.
• 94.21% of the companies in the same industry are more expensive than URBN, based on the Enterprise Value to EBITDA ratio.
• 76.86% of the companies in the same industry are more expensive than URBN, based on the Price/Free Cash Flow ratio.
• The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• The decent profitability rating of URBN may justify a higher PE ratio.

Profitability Analysis for NASDAQ:URBN

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:URBN, the assigned 6 is a significant indicator of profitability:

• URBN has a better Return On Assets (7.28%) than 77.69% of its industry peers.
• URBN has a Return On Equity of 13.83%. This is in the better half of the industry: URBN outperforms 71.90% of its industry peers.
• With a decent Return On Invested Capital value of 9.29%, URBN is doing good in the industry, outperforming 72.73% of the companies in the same industry.
• The 3 year average ROIC (8.69%) for URBN is below the current ROIC(9.29%), indicating increased profibility in the last year.
• Looking at the Profit Margin, with a value of 5.83%, URBN is in the better half of the industry, outperforming 78.51% of the companies in the same industry.
• URBN has a better Operating Margin (7.69%) than 77.69% of its industry peers.

Evaluating Health: NASDAQ:URBN

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:URBN has received a 7 out of 10:

• An Altman-Z score of 3.46 indicates that URBN is not in any danger for bankruptcy at the moment.
• URBN has a Altman-Z score of 3.46. This is in the better half of the industry: URBN outperforms 75.21% of its industry peers.
• There is no outstanding debt for URBN. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
• The Quick ratio of URBN (0.86) is better than 69.42% of its industry peers.

Looking at the Growth

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:URBN was assigned a score of 5 for growth:

• The Earnings Per Share has grown by an impressive 46.25% over the past year.
• The Earnings Per Share is expected to grow by 8.83% on average over the next years. This is quite good.
• When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

More Decent Value stocks can be found in our Decent Value screener.

For an up to date full fundamental analysis you can check the fundamental report of URBN

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.