As of April 3, 2026, Urban Outfitters Inc has a Discounted Cash Flow (DCF) derived fair value of $103.43 per share. With the current market price at $64.57, this represents a potential upside of 60.2%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $87.65 |
| DCF Fair Value (10-year) | $103.43 |
| Potential Upside (5-year) | 35.7% |
| Potential Upside (10-year) | 60.2% |
| Discount Rate (WACC) | 5.9% - 8.8% |
Revenue is projected to grow from $6165 million in 01-2026 to $10414 million by 01-2036, representing a compound annual growth rate of approximately 5.4%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 01-2026 | 6165 | 11% |
| 01-2027 | 6456 | 5% |
| 01-2028 | 6747 | 5% |
| 01-2029 | 7231 | 7% |
| 01-2030 | 7578 | 5% |
| 01-2031 | 8160 | 8% |
| 01-2032 | 8382 | 3% |
| 01-2033 | 8831 | 5% |
| 01-2034 | 9249 | 5% |
| 01-2035 | 9868 | 7% |
| 01-2036 | 10414 | 6% |
Net profit margin is expected to improve from 8% in 01-2026 to 7% by 01-2036, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 01-2026 | 465 | 8% |
| 01-2027 | 480 | 7% |
| 01-2028 | 501 | 7% |
| 01-2029 | 537 | 7% |
| 01-2030 | 563 | 7% |
| 01-2031 | 606 | 7% |
| 01-2032 | 623 | 7% |
| 01-2033 | 656 | 7% |
| 01-2034 | 687 | 7% |
| 01-2035 | 733 | 7% |
| 01-2036 | 774 | 7% |
with a 5-year average of $221 million. Projected CapEx is expected to maintain at approximately 4% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 01-2027 | 223 |
| 01-2028 | 241 |
| 01-2029 | 263 |
| 01-2030 | 291 |
| 01-2031 | 308 |
| 01-2032 | 325 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 5 |
| Days Inventory | 62 |
| Days Payables | 29 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2027 | 848 | 145 | 275 | (5) | 433 |
| 2028 | 894 | 152 | 288 | 28 | 427 |
| 2029 | 963 | 163 | 308 | 40 | 452 |
| 2030 | 1024 | 170 | 323 | 19 | 512 |
| 2031 | 1098 | 184 | 348 | 45 | 522 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 87.65 | 35.7% |
| 10-Year DCF (Growth) | 103.43 | 60.2% |
| 5-Year DCF (EBITDA) | 70.21 | 8.7% |
| 10-Year DCF (EBITDA) | 86.61 | 34.1% |
Is Urban Outfitters Inc (URBN) a buy or a sell? Urban Outfitters Inc is definitely a buy. Based on our DCF analysis, Urban Outfitters Inc (URBN) appears to be significantly undervalued with upside potential of 60.2%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a strong buy at the current market price of $64.57.