Bank of America Merrill Lynch Has Buy On Urban Outfitters

Bank of America Merrill Lynch is out with a research report on Urban Outfitters Inc URBN after it reported earnings last night. It has a Buy rating and a $36 price target on shares. In a note to clients, Bank of America Merrill Lynch writes, "Urban Outfitters reported 2Q EPS of $0.35, above our estimate and consensus expectations, which were both $0.32. The beat versus our estimate was driven by better than expected sales at Anthropologie, where comps were flat versus our estimate of -6%. We view this as an encouraging sign of progress as Urban continues to tweak its buying processes and product assortment in the face of a fashion shift. However, our enthusiasm is tempered by a recent slowdown in trends at Anthropologie that may be related to recent negative macro developments. Accordingly, we are taking a cautious view of 2H and are reducing our F2012 EPS estimate by $0.07 to $1.48, and are reducing our Price Objective to $36. We continue to highlight Urban's strong long term growth prospects and maintain our Buy rating." Shares of URBN are down $3.17 in pre-market trading to $26.52.