Teen retailer Urban Outfitters (URBN) is popping today after the company reported better than expected second quarter results. But the underlying growth fundamentals remain weak. The stock was down some 40% year-to-date into the report. Consequently, this feels more like a valuation correction than anything else. Upside feels capped from these levels, valuation feels full, and history says big jumps like this in the stock are usually followed by gradual sell-offs.
(Source: YCHARTS)
A retailer up more than 20% in this market? That's a marvel. But the bigger marvel is that the quarter wasn't that good.
