Urban Outfitters Stock Basking in Post-Earnings Bull Notes

The options pits are bursting with activity in response

Digital Content Manager
May 24, 2023 at 10:16 AM
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Urban Outfitters, Inc. (NASDAQ:URBN) is up 16.5% to trade at $31.06 at last check, after the apparel retailer reported much better-than-expected first-quarter earnings and revenue. The company attributed the results to strong demand and leaner inventory levels. 

At least eight brokerages have hiked their price targets on URBN in response, including Barclays to $38 from $27. Nevertheless, seven of 11 analysts in coverage still call the security a tepid "hold" or worse, leaving plenty of room for upgrades moving forward.

Additional tailwinds could come from an unwinding of short interest, which has added 8.6% in the last two reporting periods. The 9.40 million shares sold show now make up 16.2% of the security's available float, or more than one week's worth of pent-up buying power.

Today's bull gap placed shares above resistance at the $29 region, which capped several rallies since February. The security is today looking to snap a three-day losing streak, and is eyeing its biggest single-day percentage since August 2020. URBN is up 31.8%  year-to-date.

The stock's usually quiet options pits are brimming with activity today. In fact, 1,938 calls and 1,815 puts have been exchanged, which is 25 times the intraday average. The most popular contract is the June 31 put, where positions are currently being bought to open.



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