Urban Outfitters Inc. ( URBN ) is a leading specialty retail company that operates under the Urban Outfitters, Anthropologie, Free People and Terrain brands, selling fashion apparel, accessories and home goods. It competes with J.Crew Group ( JCG ), Ann Taylor ( ANN ), Gap ( GPS ) and Abercrombie & Fitch ( ANF ) in this market.
Urban Outfitters and Anthropologie stores each constitute about 28-29% of our $39.72 price estimate for Urban Outfitters stock, with internet and catalog orders adding an incremental 24%. Our price estimate is roughly 5% ahead of market price.
Bridal Line Adds a New Product Niche
Here we discuss the outlook for the company's new bridal line. The company launched its new bridal line called BHLDN (short for 'Beholden') on Valentine's Day this year. In addition to wedding gowns, the collection includes bridesmaid dresses, accessories, footwear and lingerie. The line targets a demographic of slighly more mature and sophisticated brides, but still maintains its target in the below 30 age range.
Urban Outfitters is currently selling the products online and plans to open its first free-standing store in August. Event dresses are expected to be priced from $200 to $600 and bridal gowns at $1,000 to $4,000.
Going forward, the company expects to open two to three BHLDN stores, each 3,000 to 4,000 square feet in size, in 2012. The company could be aiming to increase the store count to between 50 and 100 in the long-run, according to Women's Wear Daily.
New Line Seems to Fit
This new line seems to suit Urban Outfitters' recent initiative of exploring new niches and establishing itself within these markets. Over the past few years, the company has added the Terrain and Leifsdottir brands to complement its core Urban Outfitters and Anthropolgie brands.
Its Terrain stores, established in 2008, offer lifestyle home and garden products combined with antiques, live plants, flowers, wellness products and accessories. The brand is designed to appeal to men and women interested in a creative, sophisticated outdoor living and gardening experience. Terrain also offers a variety of landscape and design service solutions. The Leifsdottir brand, established in 2009, develops sophisticated women's contemporary apparel and is sold through Anthropologie stores as well as luxury department stores and select specialty stores across the United States.