Urban Outfitters’ Growth Potential Bolstered by Nuuly’s Success and Strategic Initiatives

Lorraine Hutchinson, an analyst from Bank of America Securities, maintained the Buy rating on Urban Outfitters (URBN – Research Report). The associated price target remains the same with $80.00.

Lorraine Hutchinson’s rating is based on several compelling factors that highlight Urban Outfitters’ growth potential. The Nuuly brand, a clothing rental business under URBN, has demonstrated significant growth and profitability, with a 55% revenue increase in fiscal year 2025. Hutchinson notes that Nuuly’s competitive advantages, such as its advanced distribution center and the ability to source products at cost from URBN brands, position it favorably against other rental platforms.
Furthermore, Nuuly’s success is not cannibalizing URBN’s other brands but rather complementing them by encouraging subscribers to spend more. The shared services platform and data insights from Nuuly are expected to enhance decision-making across URBN’s portfolio. Additionally, URBN’s investment in a highly automated distribution center supports its expanding e-commerce operations, projecting $2.5 billion in online revenue for fiscal year 2026. These factors collectively underpin Hutchinson’s Buy rating, reflecting confidence in URBN’s strategic initiatives and growth trajectory.

According to TipRanks, Hutchinson is a 4-star analyst with an average return of 7.1% and a 53.65% success rate. Hutchinson covers the Consumer Cyclical sector, focusing on stocks such as Kohl’s, Bath & Body Works, and Nike.

In another report released today, Robert W. Baird also upgraded the stock to a Buy with a $90.00 price target.