Tis the season for holiday shopping. Among those benefiting is highly rated clothing chain Urban Outfitters, which continues to put up dazzling earnings numbers (120% EPS growth last quarter). On Tuesday, Urban Outfitters stock earned a bump higher for its stock Relative Strength (RS) Rating, from 77 to 81. The upgrade pushes URBN into a select group of stocks.
The upgraded 81 RS Rating means Urban Outfitters stock bested 81% of all stocks for price performance over the past year. The upgrade makes it one to watch because market research shows that the top-performing stocks often have an RS Rating north of 80 as they launch their biggest runs.
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Urban Outfitters Stock Completes Cup With Handle
In terms of top and bottom line numbers, Urban Outfitters has posted rising EPS growth over the last four quarters. Top line growth has also risen during the same period. Last quarter the Philadelphia-based trendy apparel retailer reported 120% higher earning to 88 cents per share on a 9% revenue gain to $1.28 billion.
The prior three periods the operator of more than 700 apparel stores in the U.S. and Europe reported that EPS fell 17%, then rose 70% and 72%.
On Aug. 10 Urban Outfitters stock hit a more-than two-year high at 37.81. From there it consolidated, forming a cup-with-handle base. It tried to break out on Nov. 20, rising above the buy point, but it quickly retreated.
The last three days it's been mounting another attempt, up 2.3% Friday, and 1.8% Monday. Tuesday afternoon Urban Outfitters stock was up 4.8%, above its 50-day line.
Among its other ratings Urban Outfitters stock has a near-best 97 Composite Rating, out of 99. It boasts a top-notch 99 Earnings Per Share Rating. Reflecting strong fundamentals, it carries a B SMR Rating (sales + profit margin + return on equity) on an A-to-E scale.
Its relative strength line, the blue line on every IBD chart that tracks a stock's performance vs. the S&P 500, has been rising steadily since June 2022.
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One yellow flag for the watchlist candidate is its D+ Accumulation/Distribution Rating. That means that institutional investors like mutual funds and insurance company investment funds are selling more shares than buying. Look for that to improve to a C or better rating.
Urban Outfitters stock earns the No. 4 rank among its peers in the 34-stock Retail-Apparel/Shoes/Accessories industry group. Lululemon Athletica and Ross Stores are also among the group's highest-rated stocks. The group itself boasts an A+ Group Relative Strength Rating.
When looking for the best stocks to buy and watch, relative price strength is a key indicator.
Investor's Business Daily's Relative Strength Rating measures market leadership with a 1 (worst) to 99 (best) score. The rating shows how a stock's price performance over the last 52 weeks compares to all the other stocks in our database.
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