Apparel retailer Urban Outfitters’ (URBN) shares tumbled after the company reported its most recent quarterly results. The stock retreated due to the company’s update on supply chain and other issues it is facing. Analysts expect strong earnings growth from URBN in the current quarter. Should one buy shares of URBN? Let’s discuss. Read on.Shares of apparel retailer Urban Outfitters, Inc. (NASDAQ:) retreated last week despite the company’s upbeat third-quarter earnings report. The stock fell 11.9% over the last five trading sessions to $31.85. Investors were concerned about the company’s business update, which discussed how the company’s supply chain disruptions and elevated costs have negatively impacted its operations. URBN also pointed out the drop in sales in stores. Due to strong growth of digital channels sales and strong double-digit sales growth, the company saw a 14% increase in net comparable retail segment sales year over year. However, it was partially offset due to lower foot traffic and negative mid-single-digit retail store sales. URBN headquarters are located in Philadelphia, Pa.

As the holiday season draws near, top clothing brand URBN expects to experience a surge in both in-store and online sales. According to the National Retail Federation, holiday sales during November and December are expected to rise between 8.5% and 10.5%, for a total of between $843.4 billion and $859 billion, marking an all-time high for holiday sales growth and topping last year’s record. URBN expects to draw more people to its shops, as it has made solid progress in the vaccine front.

The company’s stable top-line and bottom-line growth reflect URBN’s ability to maintain its growth trajectory. The inventory levels of the company increased 28.2% in the third quarter compared to the previous year. URBN is expected to benefit from holiday shopping.

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