Citi Downgrades Urban Outfitters to Neutral Ahead of Q2 Report

Citi has downgraded Urban Outfitters (URBN) to Neutral from Buy with a price target of $76, citing caution on the specialty apparel group heading into the second half of 2025 and additional risk from higher India tariffs. The shares are up 86% since November, with a balanced risk/reward profile.

Citi has downgraded Urban Outfitters (URBN) to Neutral from Buy, adjusting its price target to $76. The investment bank cited concerns about the specialty apparel group heading into the second half of 2025 and additional risks from higher India tariffs. Despite the downgrade, URBN's shares have seen significant growth, rising by 86% since November 2024, with a balanced risk/reward profile.

The current stock price of Urban Outfitters stands at $75.33, reflecting a slight decline of 1.40% from the previous close. The stock has traded within a range of $75.05 to $77.19 throughout the day, with a 52-week range of $33.86 to $80.71. The company's market capitalization is approximately $6.73 billion, with a trading volume of 1.91 million shares.

Analysts at Citi maintained their cautious stance, noting the potential headwinds the company might face in the second half of the year. The specialty apparel sector is expected to experience a 5.6% year-over-year top-line growth and a 12.6% increase in the bottom line this earnings season. However, the higher India tariffs could pose additional challenges for Urban Outfitters, which has a significant presence in the region.

Urban Outfitters operates under several well-known brands, including Anthropologie and Free People, and competes with major retailers such as Walmart, Abercrombie & Fitch, and Burlington Stores. The company's strong performance in the Retail-Wholesale sector is anticipated to continue, with analysts expecting it to surpass earnings forecasts this season.

As the earnings season nears its end, investors are advised to monitor Urban Outfitters' performance closely. The company's stock has shown resilience and growth, but the recent downgrade by Citi suggests a cautious approach. Investors should consider the potential risks and benefits before making any investment decisions.

Reference List:
[1] https://site.financialmodelingprep.com/market-news/urban-outfitters-urbn-neutral-rating-price-target-increase-ubs
[2] https://www.investing.com/equities/urban-outfitters