Earnings Preview: Urban Outfitters, Inc. (URBN)

Traders are expecting a bigger-than-usual post-earnings move from Urban Outfitters, Inc. (NASDAQ:URBN)

Nov 13, 2015 at 3:09 PM
facebook X logo linkedin

As a brutal week on Wall Street comes to a merciful close, many are already looking ahead to next week. Much of the earnings attention will focus on Tuesday, when blue chips Home Depot Inc (NYSE:HD) and Wal-Mart Stores, Inc. (NYSE:WMT) report. However, another notable name, retailer Urban Outfitters, Inc. (NASDAQ:URBN), will report a day earlier. Below, we'll take a pre-earnings look at URBN. 

URBN is sliding alongside its retail peers today, giving up 6.3% to trade at $24.49, and earlier touching a three-year low of $24.43. Option traders are betting on extended losses, too, ahead of Monday's event. Puts are crossing at five times the average late-day pace, with apparent buy-to-open activity detected at the equity's November 23 put. In other words, traders are expecting another multi-year low from Urban Outfitters, Inc. by front-month expiration, at next Friday's close. 

Put buying is nothing new for the equity's option traders. Looking at data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), URBN's 10-day put/call volume ratio stands at 3.17. Not only have more than three puts been bought to open for every call in recent weeks, but this ratio stands higher than 94% of all other readings from the past year. In short, put buying has been unusually popular leading up to earnings. 

With Urban Outfitters, Inc. (NASDAQ:URBN) having now given back 30% of its value in 2015, shareholders have to be hoping the company can perform better post-earnings than it generally has in the past. Specifically, URBN has only finished a post-earning session in the black twice, going back eight quarters -- with an average swing of 6.7%. This time around, the options market is pricing in a loftier move of 10.8%, going by the security's near-term at-the-money straddle

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI