Zacks_Analysts' Blog : Urban Outfitters to Repurchase Shares - Analyst Blog

Moving ahead with the share repurchase program, Urban Outfitters Inc. (URBN) announced on Tuesday that it would buy an additional 10 million common shares.

Urban Outfitters received authorization from the board of directors for the share repurchase in addition to the previously authorized 8 million shares.

During the recently concluded third quarter of the year the company had bought back 4,273,267 shares at $31.06 per share, aggregating to $133 million.

At the end of the quarter or as on October 31, 2010 the company had 491, 553 shares at its disposal. Even in the second quarter, Urban Outfitters had bought back 2,015,180 shares at $33.72 per share, aggregating $68 million.

Thus, the company is continuing its repurchase program which was declared in 2006, executing it at its own decided pace. The company has 169 million shares outstanding.

Urban Outfitters displayed strong growth in sales even during the economic downturn. The company reported 13.4% year-on-year increase in total net sales to $573.6 million, though short of the Zacks Consensus Sales Estimate of $583 million.

As on October 31, 2010 the company had cash and cash equivalents of $253.5 million and shareholder’s equity of $1,319.9 million. Urban outfitters had also surpassed the Zacks Consensus Estimate by a penny as it reported earnings of 43 cents per share.

In the retail industry, the company competes with Abercrombie & Fitch Co. (ANF), Bebe Stores Inc. (BEBE), and Gap Inc. (GPS).

We currently have a Zacks #3 Rank for the company, which translates into a ‘Hold’ rating on a short-term basis.