As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the apparel retailer industry, including Urban Outfitters (NASDAQ:URBN) and its peers.
Apparel sales are not driven so much by personal needs but by seasons, trends, and innovation, and over the last few decades, the category has shifted meaningfully online. Retailers that once only had brick-and-mortar stores are responding with omnichannel presences. The online shopping experience continues to improve and retail foot traffic in places like shopping malls continues to stall, so the evolution of clothing sellers marches on.
The 9 apparel retailer stocks we track reported a satisfactory Q3. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 2.1% below.
While some apparel retailer stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.1% since the latest earnings results.
Best Q3: Urban Outfitters (NASDAQ:URBN)
Founded as a purveyor of vintage items, Urban Outfitters (NASDAQ:URBN) now largely sells new apparel and accessories to teens and young adults seeking on-trend fashion.
Urban Outfitters reported revenues of $1.36 billion, up 6.3% year on year. This print exceeded analysts’ expectations by 1.7%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ gross margin estimates and an impressive beat of analysts’ EBITDA estimates.
“We are pleased to announce record third quarter sales and earnings, both of which exceeded our expectations. These results were driven by outperformance across all three business segments – Retail, Subscription and Wholesale,” said Richard A. Hayne, Chief Executive Officer.
The stock is up 41% since reporting and currently trades at $56.61.
Is now the time to buy Urban Outfitters? Access our full analysis of the earnings results here, it’s free.
Victoria's Secret (NYSE:VSCO)
Spun off from L Brands in 2020, Victoria’s Secret (NYSE:VSCO) is an intimate clothing and beauty retailer that sells its own brands of lingerie, undergarments, and personal fragrances.
Victoria's Secret reported revenues of $1.35 billion, up 6.5% year on year, outperforming analysts’ expectations by 4.6%. The business had an exceptional quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ EPS estimates.
Victoria's Secret pulled off the biggest analyst estimates beat among its peers. The market seems unhappy with the results as the stock is down 23.5% since reporting. It currently trades at $32.92.
Is now the time to buy Victoria's Secret? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Torrid (NYSE:CURV)
Promoting a message of body positivity and inclusiveness, Torrid Holdings (NYSE:CURV) is a plus-size women’s apparel and accessories retailer.
Torrid reported revenues of $263.8 million, down 4.2% year on year, falling short of analysts’ expectations by 6.6%. It was a disappointing quarter as it posted full-year EBITDA guidance missing analysts’ expectations.
Torrid delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. Interestingly, the stock is up 36.9% since the results and currently trades at $6.34.
Read our full analysis of Torrid’s results here.
Lululemon (NASDAQ:LULU)
Originally serving yogis and hockey players, Lululemon (NASDAQ:LULU) is a designer, distributor, and retailer of athletic apparel for men and women.
Lululemon reported revenues of $2.40 billion, up 8.7% year on year. This number topped analysts’ expectations by 1.6%. Overall, it was a satisfactory quarter as it also logged a solid beat of analysts’ EBITDA estimates.
Lululemon scored the highest full-year guidance raise among its peers. The stock is up 13.6% since reporting and currently trades at $391.91.
Read our full, actionable report on Lululemon here, it’s free.
Zumiez (NASDAQ:ZUMZ)
With store associates called “Zumiez Stash Members”, Zumiez (NASDAQ:ZUMZ) is a specialty retailer of street and skate apparel, footwear, and accessories.
Zumiez reported revenues of $222.5 million, up 2.8% year on year. This print met analysts’ expectations. It was a strong quarter as it also recorded an impressive beat of analysts’ EPS and EBITDA estimates.
The stock is down 22.7% since reporting and currently trades at $15.55.
Read our full, actionable report on Zumiez here, it’s free.
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