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12 October 2012 Americas/United States Equity Research Specialty Softlines

Urban Outfitters, Inc. (URBN) Rating NEUTRAL* Price (11 Oct 12, US$) 36.97 Target price (US$) (from 39.00) 42.00¹ 52-week price range 39.82 - 23.12 Market cap. (US$ m) 5,380.28 Enterprise value (US$ m) 5,120.64 *Stock ratings are relative to the relevant country benchmark. ¹Target price is for 12 months.

Research Analysts Christian Buss 212 325 9667 [email protected] Bilun Boyner 212 325 8717 [email protected] Darla Shay 212 325 2379 [email protected]

INCREASE TARGET PRICE

Pricing Study Highlights Improved Competitive Positioning At Anthropologie. TP to $42. A pricing analysis of 30,000+ SKUs at 13 specialty retailers gives us increasing confidence that Urban Outfitters is taking steps to address changing competitive dynamics across the mall. We are incrementally more positive on potential 2H12 and 2013 earnings power and are raising our target price to $42 from $39 as a result. Highlights from this analysis include:

■ Decline in both Pricing Premium and Opening Price Points at Anthropologie. Our analysis suggests that Anthropologie price premium relative to our peer set has declined by ~10 percentage points Y/Y. Although we continue to find Anthropologie pricing elevated, at 63% premium to peer average, we are encouraged to see improvements across categories. Our analysis also suggests a $10, or 13%, decline in opening level AURs. More importantly, opening price points for core categories, dresses and sweaters, as well as jeans are now more in line with the rest of the mall, at sub $100 price points.

■ Urban Outfitters and Free People Pricing Largely In Line With Last Year. Urban Outfitters remains largely price competitive compared to the rest of the mall, with average pricing at a 6% discount to peer group (down from 2% discount last year.) We also note that Free People pricing is consistent with last year, at a 60% premium to the peer group.

■ Raising Target Price to $42. We are encouraged to see that URBN has made progress adjusting price points at Anthropologie. As a result, we have increasing conviction in 2012 and 2013 earnings power and are raising our target price to $42 from $39. Our target price is based on an equal-weighted Share price performance Daily Oct 12, 2011 - Oct 11, 2012, 10/12/11 = US$24.15 38 33 28 23 Oct-11

Jan-12 Price

Apr-12 Jul-12 Indexed S&P 500 INDEX

On 10/11/12 the S&P 500 INDEX closed at 1434.2

Quarterly EPS 2012A 2013E 2014E

Q1 0.23 0.23 0.30

Q2 0.35 0.42 0.48

Q3 0.33 0.42 0.48

Q4 0.24 0.55 0.62

Financial and valuation metrics Year EPS (CS adj.) (US$) Prev. EPS (US$) P/E (x) P/E rel. (%) Revenue (US$ m) EBITDA (US$ m) OCFPS (US$) P/OCF (x) EV/EBITDA (current) Net debt (US$ m) ROIC (%) Number of shares (m) BV/share (Next Qtr., US$) Net debt (Next Qtr., US$ m) Net debt/tot cap (Next Qtr., %)

01/12A 1.16 — 31.8 209.6 2,473.8 386.8 1.81 14.6 13.6 -145 19.43 145.53 8.8 -150.7 -11.9

01/13E 01/14E 1.62 1.88 — 1.89 22.9 19.7 160.3 153.5 2,762.0 3,069.5 482.9 546.3 2.42 2.74 15.3 13.5 10.9 9.6 -260 -411 21.20 18.90 IC (current, US$ m) EV/IC (x) Dividend (Next Qtr., US$) Dividend yield (%)

01/15E 2.25 2.28 16.4 142.8 3,382.9 633.4 3.21 11.5 8.3 -609 18.13 921.00 4.7 — —

Source: Company data, Credit Suisse estimates.

DISCLOSURE APPENDIX CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, INFORMATION ON TRADE ALERTS, ANALYST MODEL PORTFOLIOS AND THE STATUS OF NON-U.S ANALYSTS. U.S. Disclosure: Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

CREDIT SUISSE SECURITIES RESEARCH & ANALYTICS

BEYOND INFORMATION™ Client-Driven Solutions, Insights, and Access

12 October 2012

average of: 1) peer group multiples ($42); 2) A five-year DCF ($42); and 3) a long-term growth driver ($41.)

Anthropologie ■

Anthropologie Pricing Premium Declines Meaningfully in 3Q12 Y/Y. Our analysis of a core basket of goods at Anthropologie highlights a 10 percentage point Y/Y reduction in the pricing premium relative to peers. This premium is now 63% versus 72% last year. Pricing does remain above that mono-branded specialty retailers, but is now below premium department stores.

Exhibit 1: Anthropologie Pricing Premium Relative To Specialty Peers Is Down Ten Percentage Points Y/Y Brands (10/08/2012) Anthropologie Abercrombie & Fitch American Eagle Outfitters Bloomingdale's Forever 21 Gap H&M Nordstorm TopShop Uniqlo Zara Average

Basket Price $734 $499 $314 $901 $141 $383 $191 $796 $534 $264 $487 $451

Anthropologie Premium $ % $236 $420 ($167) $593 $351 $543 ($62) $200 $470 $247 $283

47% 134% -19% 421% 92% 285% -8% 37% 178% 51% 63%

Brands (10/02/2011) Anthropologie Abercrombie & Fitch American Eagle Outfitters Bloomingdale's Forever 21 Gap H&M Nordstorm TopShop Uniqlo Zara Average

Basket Price $727 $564 $300 $812 $145 $361 $173 $725 $493 $281 $386 $424

Anthropologie Premium $ %

Avg Price $75 $28 $59 $151 $75 $29 $8

Anthropologie Price Premium $158 112% $58 107% $98 66% $173 15% $168 125% $48 68% $24 183%

$164 $428 ($85) $582 $366 $554 $2 $234 $446 $341 $303

29% 143% -10% 401% 101% 321% 0% 47% 159% 88% 72%

Source: Company data, Credit Suisse estimates

Exhibit 2: Anthropologie Pricing Remains Above Peer Average Across Categories Category (10/08/2012) Dresses Graphic Ts Sweaters Light winter coat Jeans Accessories -Belt Intimates

Avg Price $78 $29 $66 $161 $78 $30 $9

Anthropologie Price Premium $158 102% $38 30% $98 49% $198 23% $178 128% $48 58% $16 78%

Category (10/02/2011) Dresses Graphic Ts Sweaters Light winter coat Jeans Accessories -Belt Intimates

Source: Company data, Credit Suisse estimates

■ Significant Reduction In Opening Price Points At Anthropologie. Compared to last year our analysis suggests a $10, or 13%, decline in opening level AURs at Anthropologie. More importantly we highlight that opening price points for core categories, dresses and sweaters, as well as jeans are now in line with the rest of the mall at below $100. We expect this will help attract new customers to the concept, and provide a more clear value proposition for existing customers.

Urban Outfitters, Inc. (URBN)

2

12 October 2012

Exhibit 3: Opening Price Points Have Declined $10, or 13%, Y/Y

Low end Fall12 Fall11 $78 $118 $24 $24 $49 $78 $168 $131 $88 $118 $28 $28 $12 $18 $64 $74

Category Dresses Graphic Ts Sweaters Light winter coat Jeans Accessories -Belt Intimates Average

Difference ($40) $0 ($29) $37 ($30) $0 ($6) ($10)

Source: Company data, Credit Suisse estimates

Urban Outfitters ■ Urban Outfitters Remains Price Competitive. Our survey suggests that Urban Outfitters prices for our core basket of items and categories continue to be on par with competitors, with pricing below that of upper tier department store brands, but ahead of mall based teen retailers. o

Urban Outfitters average basket price is down 2% Y/Y, versus peer group average which is up 3% Y/Y.

Exhibit 4: Urban Pricing Remains Competitive With Peers

Urban Outfitters Abercrombie & Fitch American Eagle Outfitters Bloomingdale's Forever 21 Gap H&M Nordstorm TopShop Uniqlo Zara Average

Basket Price $542 $730 $379 $1,057 $206 $476 $238 $960 $623 $351 $486 $550

($188) $164 ($515) $336 $66 $304 ($418) ($81) $191 $57 ($8)

-26% 43% -49% 163% 14% 128% -44% -13% 55% 12% -2%

Exhibit 5: Urban Outfitters is Largely Price Competitive Across Categories Urban Avg Urban Category (10/02/2011) Category (10/08/2012) Price Price Premium Dresses Dresses $69 $78 -12% Graphic Ts $39 $27 43% Graphic Ts Sweaters $79 $64 23% Sweaters Light winter coat $109 $154 -29% Light winter coat Jeans $68 $78 -13% Jeans Accessories -Belt Accessories -Belt $24 $30 -21% Intimates Intimates $8 $9 -11% Men's casual shirt Men's casual shirt $68 $61 11% Men's pants Men's pants $68 $66 4%

Urban Price $79 $29 $69 $150 $60 $29 $8 $59 $59

Avg Price $75 $28 $59 $151 $75 $29 $8 $60 $67

Urban Premium 6% 4% 17% 0% -20% 1% -6% -2% -11%

Brands (10/08/2012) Urban Outfitters Abercrombie & Fitch American Eagle Outfitters Bloomingdale's Forever 21 Gap H&M Nordstorm TopShop Uniqlo Zara Average

Basket Price $532 $606 $393 $1,191 $202 $493 $271 $931 $640 $344 $606 $568

URBN Premium $ % ($74) $139 ($659) $330 $39 $261 ($399) ($108) $188 ($74) ($36)

-12% 35% -55% 164% 8% 97% -43% -17% 55% -12% -6%

Brands (10/02/2011)

URBN Premium $ %

Source: Company data, Credit Suisse estimates

Source: Company data, Credit Suisse estimates

Urban Outfitters, Inc. (URBN)

3

12 October 2012

Free People ■ Free People Pricing Premium Remains Stable Y/Y. Free People product pricing remains well above peers, with pricing for our core basket 61% above that of peers, in line with last year. Free People pricing is above that of all mono-brand competitors, but below upper-tier department stores. o

Free People average basket price is up 7% Y/Y, versus peer group average which is up 6% Y/Y.

Exhibit 6: Price Premium Remains In Line With Last Year at 60% Basket Free People Premium Brands (10/08/2012) Brands (10/02/2011) Price $ % Free People $728 Free People Abercrombie & Fitch $499 $230 46% Abercrombie & Fitch American Eagle Outfitters $314 $414 132% American Eagle Outfitters Bloomingdale's $901 ($173) -19% Bloomingdale's Forever 21 $141 $587 417% Forever 21 Gap $383 $345 90% Gap H&M $191 $537 282% H&M Nordstorm $796 ($68) -9% Nordstorm TopShop TopShop $534 $194 36% Uniqlo $264 $464 175% Uniqlo Zara $487 $241 50% Zara Average $451 $277 61% Average

Basket Price $680 $564 $300 $812 $145 $361 $173 $725 $493 $281 $386 $424

Free People Premium $ % $117 $381 ($132) $535 $319 $507 ($45) $187 $399 $294 $256

21% 127% -16% 368% 88% 294% -6% 38% 142% 76% 60%

Source: Company data, Credit Suisse estimates

Exhibit 7: Pricing above Peer Average Across Categories FP Category (10/08/2012) FP Price Avg Price Premium Dresses $148 $78 90% Graphic Ts $68 $29 133% Sweaters $118 $66 80% Light winter coat $248 $161 54% Jeans $88 $78 13% Accessories -Belt $48 $30 58% Intimates $10 $9 11%

Category (10/02/2011) Dresses Graphic Ts Sweaters Light winter coat Jeans Accessories -Belt Intimates

FP Price Avg Price $138 $48 $108 $228 $98 $48 $12

$75 $28 $59 $151 $75 $29 $8

FP Premium 85% 72% 83% 51% 31% 68% 42%

Source: Company data, Credit Suisse estimates

Methodology In order to establish if there really is a pricing gap at Urban Outfitters we conducted a large scale pricing study that:



Compared the median prices for nine product categories o

Dresses, Graphic T-shirts, Sweaters, Light winter coats, Jeans, Intimates, Belts, Men’s casual shirts, and Men’s pants)



Compared prices for a basket of 9 comparable items



Evaluated pricing across 10 key competitors: o

Abercrombie & Fitch, American Eagle Outfitters, Bloomingdales, Forever 21, Gap, H&M, Nordstrom, TopShop, Uniqlo and Zara.

Urban Outfitters, Inc. (URBN)

4

12 October 2012

Exhibit 8: Income Statement Urban Outfitters Income Statement ($ in millions except per share, store, and sq. foot data)

1Q11 Apr11A

2011 2Q11 3Q11 Jul11A Oct11A

2012 2Q12 3Q12 Jul12A Oct12E

4Q12 Jan13E

FYE 2012E

2010A

2011A

2012E

2013E

2014E

2015E

2016E

235.3 228.5 51.8 8.4 524.0

272.2 272.6 58.7 5.7 609.2

266.4 235.1 61.7 5.8 568.9

310.7 281.8 73.8 10.0 676.3

330.9 269.3 81.6 10.1 691.9

399.9 331.3 83.0 10.8 824.9

1,307.8 1,117.5 300.1 36.6 2,762.0

1,041.5 1,012.0 202.5 18.1 2,274.1

1,155.3 1,044.5 250.4 23.6 2,473.8

1,307.8 1,117.5 300.1 36.6 2,762.0

1,435.1 1,239.1 350.2 45.1 3,069.5

1,573.0 1,352.2 403.1 54.6 3,382.9

1,718.7 1,466.5 457.8 64.8 3,707.8

1,872.7 1,582.5 514.3 76.5 4,045.9

Channel Retail Stores Direct Total Retail Segment (includes stores and direct) Wholesale Intersegment elmination

391.2 102.3 493.5 30.6

1,835.8 505.0 2,340.8 138.7 (5.7)

420.6 117.1 537.7 32.6 (1.4)

501.3 137.7 639.0 37.2 (1.5)

501.9 145.6 647.5 44.4

588.3 202.3 790.6 34.4

2,012.2 602.6 2,614.8 148.6

1,720.0 433.8 2,153.8 123.9 (4.5)

1,835.8 505.0 2,340.8 138.7 (5.7)

2,012.2 602.6 2,614.8 148.6 0.0

2,217.9 685.2 2,903.1 166.4 0.0

2,431.0 768.9 3,199.9 183.1 0.0

2,655.2 851.2 3,506.4 201.4 0.0

2,888.4 936.0 3,824.4 221.5 0.0

Net sales Cost of merchandise sales (Ex-Rent Expense) Rent Expense Cost of Goods Sold - Total

730.6

2,473.8

568.9

676.3

691.9

824.9

2,762.0

2,274.1

2,473.8

2,762.0

3,069.5

3,382.9

3,707.8

4,045.9

462.1 48.5 510.7

1,449.0 164.3 1,613.3

328.7 37.8 366.5

377.3 44.5 421.8

386.1 45.5 431.6

457.0 54.2 511.2

1,549.0 181.6 1,731.0

1,197.9 139.6 1,337.5

1,449.0 164.3 1,613.3

1,549.0 181.6 1,731.0

1,700.3 196.5 1,896.8

1,848.5 214.3 2,062.8

1,998.2 233.8 2,232.0

2,166.3 255.3 2,421.5

216.1

220.0

860.5

202.4

254.5

260.3

313.7

1,031.0

936.6

860.5

1,031.0

1,172.7

1,320.2

1,475.8

1,624.4

142.7

161.4

581.8

149.6

158.6

166.0

190.6

664.7

522.2

581.8

664.7

752.7

822.7

898.0

973.8

88.0

73.4

58.5

278.7

52.9

95.9

94.3

123.1

366.2

414.4

278.7

366.2

420.0

497.4

577.8

650.6

26.6 85.4

26.8 114.7

27.4 100.8

27.4 85.9

108.1 386.8

28.1 81.0

29.0 124.9

29.5 123.8

30.1 153.2

116.7 482.9

101.1 515.5

108.1 386.8

116.7 482.9

126.3 546.3

136.0 633.4

146.3 724.1

157.1 807.8

1.4 60.2 21.6 35.8% 38.6

0.9 88.9 32.2 36.2% 56.7

2.0 75.4 24.7 32.8% 50.7

(0.2) 58.3 22.8 39.0% 35.6

4.1 282.8 101.3 35.8% 181.6

0.3 53.2 19.3 36.2% 33.9

0.1 96.1 34.8 36.2% 61.3

0.5 94.7 34.3 36.2% 60.4

0.5 123.6 44.8 36.2% 78.8

1.4 367.6 133.1 36.2% 234.5

3.0 417.4 144.3 34.6% 273.2

4.1 282.8 101.3 35.8% 181.6

1.4 367.6 133.1 36.2% 234.5

2.4 422.5 153.0 36.2% 269.5

3.2 500.7 181.3 36.2% 319.4

4.2 582.0 210.7 36.2% 371.3

5.4 656.1 237.6 36.2% 418.5

38.6

56.7

50.7

35.6

181.6

33.9

61.3

60.4

78.8

234.5

273.2

181.6

234.5

269.5

319.4

371.3

418.5

$0.25 $0.24

1.52 $1.18 $1.16

$0.23 $0.23

$0.42 $0.42

$0.42 $0.42

$0.55 $0.55

$1.63 $1.62

$1.64 $1.60

$1.18 $1.16

$1.63 $1.62

$1.89 $1.88

$2.26 $2.25

$2.69 $2.67

$3.01 $2.99

4Q11 Jan12A

FYA 2011A

1Q12 Apr12A

291.0 244.1 70.1 4.7 610.0

356.8 299.2 69.9 4.8 730.6

1,155.3 1,044.5 250.4 23.6 2,473.8

464.7 112.6 577.3 35.2 (3.3)

448.0 123.1 571.1 41.3 (2.4)

532.0 166.9 699.0 31.7 0.0

524.0

609.2

610.0

295.9 34.8 330.7

337.6 40.5 378.1

353.3 40.5 393.9

Total Gross Profit

193.4

231.1

SG&A Expenses

134.5

143.1

Operating income

58.8

Depreciation EBITDA

Sales by brand (incl direct) Urban Outfitters Anthropologie Free People Other (Terrain and Liefsdottir) Total Revenue

Interest Income (Expense) - Model Driver Interest Income (Expense) Other Income (Expense) Pre-tax income Provision for income taxes Tax Rate After-tax income Net Income Basic EPS Diluted EPS

$0.24 $0.23

$0.36 $0.35

$0.34 $0.33

Source: Company data, Credit Suisse estimates

Urban Outfitters, Inc. (URBN)

5

12 October 2012

Exhibit 9: Balance Sheet Urban Outfitters Balance Sheet ($ in millions)

1Q11 Apr11A

2011 2Q11 3Q11 Jul11A Oct11A

2012 2Q12 3Q12 Jul12A Oct12E

4Q12 Jan13E

2012E

2010A

2011E

2012E

2013E

2014E

2015E

2016E

243.9 68.7 46.5 264.3 77.8 701.3

226.4 59.3 52.6 303.2 57.1 698.6

130.5 117.1 43.9 299.8 84.7 675.9

135.5 135.9 48.2 322.8 61.6 704.0

150.7 135.9 53.1 372.1 63.0 774.8

259.6 135.9 41.4 275.1 75.2 787.2

259.6 135.9 41.4 275.1 75.2 787.2

340.3 116.4 36.5 229.6 81.2 804.0

145.3 89.9 36.7 250.1 75.1 597.0

259.6 135.9 41.4 275.1 75.2 787.2

411.2 135.9 45.9 303.2 83.3 979.5

609.0 135.9 50.6 327.7 91.8 1,214.9

845.4 135.9 55.4 354.9 100.5 1,492.1

1,109.9 135.9 60.4 385.1 109.7 1,800.9

601.2 333.9 57.8 1,694.3

685.0 126.9 74.8 1,483.7

711.9 91.2 76.3 1,555.3

722.1 91.7 76.8 1,594.6

793.3 91.7 78.6 1,738.4

868.8 91.7 93.7 1,841.4

868.8 91.7 93.7 1,841.4

586.3 352.0 52.0 1,794.3

685.0 126.9 74.8 1,483.7

868.8 91.7 93.7 1,841.4

1,184.6 91.7 103.9 2,359.7

1,521.5 91.7 114.4 2,942.5

1,891.5 91.7 125.4 3,600.7

2,287.5 91.7 136.8 4,316.9

95.8 137.7 233.5

95.8 137.7 233.5

117.8 137.4 255.2

105.8 126.0 231.7

147.4 128.9 276.2

95.9 153.6 249.5

95.9 153.6 249.5

82.9 128.1 211.0

95.8 137.7 233.5

95.9 153.6 249.5

105.6 170.3 275.9

114.8 187.6 302.4

131.5 205.5 337.1

142.6 224.2 366.8

179.2 444.3

184.0 417.4

184.0 417.4

187.8 443.0

188.6 420.4

193.0 469.2

230.1 479.6

230.1 479.6

171.7 382.8

184.0 417.4

230.1 479.6

255.1 531.0

280.9 583.3

307.9 644.9

335.8 702.6

1,304.3

1,033.8

1,066.3

1,066.3

1,112.3

1,174.2

1,269.1

1,361.8

1,361.8

1,411.5

1,066.3

1,361.8

1,828.7

2,359.2

2,955.8

3,614.3

1,705.4

1,478.1

1,483.7

1,483.7

1,555.3

1,594.6

1,738.4

1,841.4

1,841.4

1,794.3

1,483.7

1,841.4

2,359.7

2,942.5

3,600.7

4,316.9

45.0 8.0 0.2 264.3 5.0 62.9

46.4 7.8 0.2 303.2 5.0 69.3

52.1 6.9 27.02% 367.4 4.3 64.8

79.7 4.5 8.94% 250.1 8.2 61.4

67.5 5.4 0.1 250.1 6.5 52.7

51.9 6.9 0.1 299.8 4.9 64.0

56.1 6.4 0.1 322.8 5.2 67.3

52.1 6.9

79.7 4.5

66.7 5.5

62.3 5.9

67.5 5.4

66.7 5.5

66.9 5.5

66.9 5.5

66.9 5.5

67.0 5.5

372.1 4.6 65.5

275.1 7.4 62.4

275.1 6.3 52.9

229.6 5.8 51.9

250.1 6.5 52.7

275.1 6.3 52.9

303.2 6.3 53.7

327.7 6.3 53.6

354.9 6.3 53.5

385.1 6.3 53.5

Payables turnover Days payable outstanding

12.1 29.8

13.7 26.4

11.7 30.7

21.3 16.9

16.8 21.7

12.4 28.9

15.9 22.6

11.7 30.7

21.3 16.9

18.1 20.2

16.1 22.6

16.8 21.7

18.1 20.2

18.0 20.3

18.0 20.3

17.0 21.5

17.0 21.5

Cash Cycle (in Days)

33.1

42.9

34.0

44.5

31.1

35.0

44.8

34.8

45.5

32.7

29.3

31.1

32.7

33.3

33.3

32.0

32.0

4Q11 Jan12A

2011A

1Q12 Apr12A

4Q12 Jan13E

2012E

2010A

2011A

2012E

2013E

2014E

2015E

2016E

4Q11 Jan12A

2011A

1Q12 Apr12A

83.4 46.6 46.8 367.4 64.1 608.3

145.3 89.9 36.7 250.1 75.1 597.0

145.3 89.9 36.7 250.1 75.1 597.0

626.2 322.9 57.8 1,705.4

670.8 129.1 69.9 1,478.1

685.0 126.9 74.8 1,483.7

Current Liabilities: Accounts payable 109.4 Accured expenses, accrued compensation and othe 102.6 Total Current Liabilities 212.0

110.8 117.8 228.5

134.5 130.6 265.1

Long-term Liabilities: Deferred rent and other liabilities Total Liabilities

169.8 381.8

172.6 401.1

Total Stockholders' Equity

1,312.5

Total Liabilities and Stockholders' Equity

1,694.3

Assets Current Assets: Cash and Cash Equivalents Marketable securities Accounts Receivables, Net Inventories Prepaid Expenses and Other Total Current Assets Property and equipment, Net Marketable securities Deferred income taxes and other Total Assets Liabilities and Stockholders' Equity

Operating Ratios Receivables turnover DSOs Inventory Inventory turnover Days forward Inventory

Source: Company data, Credit Suisse estimates

Exhibit 10: Cash Flow Statement Urban Outfitters Cash Flow Statement ($ in millions)

1Q11 Apr11A

2011 2Q11 3Q11 Jul11A Oct11A

2012 2Q12 3Q12 Jul12A Oct12E

Cash Flows From Operating Activities: Net Income Depreciation and amortization Deferred income taxes Excess tax benefit from stock option exercises Share-based compensation expense Loss (gain) on disposition of property and equipme

38.6 26.6 (4.2) (0.4) 2.6 0.6

56.7 26.8 2.0 (0.1) 2.3 0.0

50.7 27.4 (0.1) (0.0) 3.5 0.2

39.3 27.4 (9.8) (8.5) (5.3) 0.0

185.3 108.1 (12.2) (9.0) 3.1 0.9

34.0 28.1 (6.3) (1.0) 2.9 0.0

61.3 29.0 (3.6) (0.3) 3.8 (0.1)

60.4 29.5 (1.8) (0.3) 3.8 0.0

78.8 30.1 (15.1) (0.3) 3.8 0.0

234.5 116.7 (26.7) (1.9) 14.1

273.0 101.1 (8.7) (12.8) 10.7 0.1

185.3 108.1 (12.2) (9.0) 3.1 0.9

234.5 116.7 (26.7) (1.9) 14.1 0.0

269.5 126.3 (10.2) (1.3) 15.0 0.0

319.4 136.0 (10.5) (1.3) 15.0 0.0

371.3 146.3 (11.0) (1.3) 15.0 0.0

418.5 157.1 (11.4) (1.3) 15.0 0.0

Changes in Current Assets and Liabilities: (Increase) Decrease in Receivables (Increase) Decrease in Inventories (Increase) Decrease in Prepaid Expenses and othe Increase (Decrease) in Payable, Accured Expenses Increase (Decrease) in Other non-cash balances

(9.9) (33.8) 2.3 (2.3) 0.0

(6.1) (39.3) 18.8 10.3 0.0

5.7 (64.6) (19.0) 33.8 0.0

10.1 116.8 4.2 (20.5) 0.0

(0.3) (20.8) 6.3 21.3 0.0

(7.1) (48.8) 14.4 25.8 0.0

(4.5) (24.0) 8.3 (23.0) 0.0

(4.9) (49.3) (1.4) 41.6 4.4

11.7 97.0 (12.1) (51.5) 37.1

(4.8) (25.0) 9.2 (7.1) 41.5

1.8 (43.4) 14.8 48.5 0.0

(0.3) (20.8) 6.3 21.3 0.0

(4.8) (25.0) 9.2 (7.1) 41.5

(4.5) (28.1) (8.1) 9.8 25.0

(4.7) (24.5) (8.5) 9.2 25.9

(4.8) (27.2) (8.8) 16.7 26.9

(5.0) (30.2) (9.1) 11.1 27.9

20.0

71.5 91.5

37.5 129.1

153.6 282.7

282.7

42.1

46.8 88.9

81.9 170.8

179.4 350.3

350.4

385.1

282.7

350.4

393.2

456.0

523.1

572.7

(35.7) (51.1) 115.4 28.6

(41.8) (22.6) 42.0 (22.4) 6.2

(62.0) (23.4) 227.1 141.7 147.8

(50.4) (72.3) 30.2 (92.6) 55.3

(190.0) (169.5) 414.8 55.3

(52.8) (61.7) 53.8 (60.6)

(40.4) (71.0) 68.5 (42.8) (103.4)

(41.7) 0.0 0.0 (41.7) (145.2)

(45.5) 0.0 0.0 (45.5) (190.6)

(180.4) (132.6) 122.3 (190.6)

(143.6) (463.1) 571.2 (35.5)

(190.0) (169.5) 414.8 55.3

(180.4) (132.6) 122.3 (190.6)

(189.6) 0.0 0.0 (189.6)

(200.9) 0.0 0.0 (200.9)

(223.7) 0.0 0.0 (223.7)

(238.8) 0.0 0.0 (238.8)

2.4 0.4 (148.7)

1.1 0.1 (67.3)

0.0 0.0 (322.3)

0.6 8.5 (7.2)

4.1 9.0 (545.5)

2.1 1.0 0.0

0.5 0.3 0.0

10.0 0.0 (35.0)

10.0 0.0 (35.0)

22.6 1.3 (70.0)

24.1 12.8 (204.7)

4.1 9.0 (545.5)

22.6 1.3 (70.0)

24.9 0.0 (77.0)

27.4 0.0 (84.7)

30.1 0.0 (93.2)

33.2 0.0 (102.5)

(146.0)

(66.1) (212.0)

(322.3) (534.3)

1.9 (532.4)

(532.4)

3.1

0.9 3.9

(25.0) (21.1)

(25.0) (46.1)

(46.1)

(167.7)

(532.4)

(46.1)

(77.0)

(84.7)

(93.2)

(102.5)

(0.6) 0.0 (195.0)

0.7

0.1

0.0

0.0

(14.8)

5.0 (9.8)

15.2 5.4

108.9 114.4

0.8 0.0 114.5

(0.6) 0.0 181.2

(0.6) 0.0 (195.0)

0.8 0.0 114.5

0.0 0.0 126.6

0.0 0.0 170.4

0.0 0.0 206.3

0.0 0.0 231.3

340.3 145.2

145.3 130.5

130.5 135.5

135.5 150.7

150.7 259.6

145.2 259.6

159.0 340.3

340.3 145.2

145.2 259.6

259.6 411.2

411.2 609.0

609.0 845.4

845.4 1,109.9

Cash Provided By Operating Activities Cumulative Cash Flows From Investing Activities: Cash paid for property and equipment Cash paid for marketable securities Sales and maturities of marketable securities Cash (Used In) Provided by Investing Activities Cumulative Cash Flows From Financing Activities: Exercise of stock options Excess tax benefits form stock option exercises Share repurchases Cash (Used In) Provided by Financing Activities Cumulative Effect of exchange rates on Cash and Cash Equival Impact of discountinued operations Change in Cash and Cash Equivalents Cumulative Cash at Beginning of Period Cash at End of Period

1.0

(0.6)

0.1

(1.1)

(96.3)

(17.6) (113.9)

(143.0) (256.9)

61.9 (195.0)

340.3 243.9

243.9 226.4

226.4 83.4

83.4 145.2

Source: Company data, Credit Suisse estimates

Urban Outfitters, Inc. (URBN)

6

12 October 2012

Companies Mentioned (Price as of 11 Oct 12) Abercrombie & Fitch Co. (ANF, $33.53, UNDERPERFORM [V], TP $32.00) American Eagle Outfitters, Inc. (AEO, $21.79) Gap, Inc. (GPS, $36.34) Hennes & Mauritz (HMb.ST, SKr229.60) Inditex (ITX.MC, Eu98.00) Macy's, Inc. (M, $39.23, OUTPERFORM, TP $43.00) Nordstrom, Inc. (JWN, $55.33, NEUTRAL, TP $56.00) Urban Outfitters, Inc. (URBN, $36.97, NEUTRAL, TP $42.00)

Disclosure Appendix Important Global Disclosures I, Christian Buss, certify that (1) the views expressed in this report accurately reflect my personal views about all of the subject companies and securities and (2) no part of my compensation was, is or will be directly or indirectly related to the specific recommendations or views expressed in this report. See the Companies Mentioned section for full company names. 3-Year Price, Target Price and Rating Change History Chart for URBN URBN Date 10/26/09 4/5/10 7/20/10 12/14/10 2/24/11 9/7/11 10/3/11 11/15/11 2/9/12 4/2/12 8/21/12

Closing Price (US$) 32.97 38.91 33.64 36.34 37.04 25.26 21.9 26.85 27.405 29.54 36.98

Target 46 Price Initiation/ (US$) Rating Assumption 41 33 N X 41 36 NC 45 O X 33 31 NC 29 N X 26 26 25 10/26/09 30 US$21 32 39

45 41 39 O

NC

NC

N

32 30

29 26 12/14/10

Closing Price

Target Price

N 25

9/7/11

Initiation/Assumption

Rating

O=Outperform; N=Neutral; U=Underperform; R=Restricted; NR=Not Rated; NC=Not Covered

The analyst(s) responsible for preparing this research report received compensation that is based upon various factors including Credit Suisse's total revenues, a portion of which are generated by Credit Suisse's investment banking activities. As of October, 2 2012 Analysts’ stock rating are defined as follows: Outperform (O): The stock’s total return is expected to outperform the relevant benchmark* by at least 10-15% or more, (depending on perceived risk) over the next 12 months. Neutral (N): The stock’s total return is expected to be in line with the relevant benchmark* (range of ±10-15%) over the next 12 months. Underperform (U): The stock’s total return is expected to underperform the relevant benchmark* by 10-15% or more over the next 12 months. *Relevant benchmark by region: As of 2nd October 2012, U.S. and Canadian as well as European ratings are based on a stock’s total return relative to the analyst's coverage universe which consists of all companies covered by the analyst within the relevant sector, with Outperforms representing the most attractive, Neutrals the less attractive, and Underperforms the least attractive investment opportunities. For Latin American, Japanese, and non-Japan Asia stocks, ratings are based on a stock’s total return relative to the average total return of the relevant country or regional benchmark; Australia, New Zealand are, and prior to 2nd October 2012 U.S. and Canadian ratings were based on (1) a stock’s absolute total return potential to its current share price and (2) the relative attractiveness of a stock’s total return potential within an analyst’s coverage universe. For Australian and New Zealand stocks, 12-month rolling yield is incorporated in the absolute total return calculation and a 15% and a 7.5% threshold replace the 1015% level in the Outperform and Underperform stock rating definitions, respectively. The 15% and 7.5% thresholds replace the +10-15% and -1015% levels in the Neutral stock rating definition, respectively. Restricted (R): In certain circumstances, Credit Suisse policy and/or applicable law and regulations preclude certain types of communications, including an investment recommendation, during the course of Credit Suisse's engagement in an investment banking transaction and in certain other circumstances. Volatility Indicator [V]: A stock is defined as volatile if the stock price has moved up or down by 20% or more in a month in at least 8 of the past 24 months or the analyst expects significant volatility going forward. Analysts’ sector weightings are distinct from analysts’ stock ratings and are based on the analyst’s expectations for the fundamentals and/or valuation of the sector* relative to the group’s historic fundamentals and/or valuation: Overweight: The analyst’s expectation for the sector’s fundamentals and/or valuation is favorable over the next 12 months.

Urban Outfitters, Inc. (URBN)

7

12 October 2012

Market Weight: The analyst’s expectation for the sector’s fundamentals and/or valuation is neutral over the next 12 months. Underweight: The analyst’s expectation for the sector’s fundamentals and/or valuation is cautious over the next 12 months. *An analyst’s coverage sector consists of all companies covered by the analyst within the relevant sector. An analyst may cover multiple sectors. Credit Suisse’s distribution of stock ratings (and banking clients) is: Global Ratings Distribution Outperform/Buy* 44% (53% banking clients) Neutral/Hold* 39% (48% banking clients) Underperform/Sell* 14% (43% banking clients) Restricted 2% *For purposes of the NYSE and NASD ratings distribution disclosure requirements, our stock ratings of Outperform, Neutral, and Underperform most closely correspond to Buy, Hold, and Sell, respectively; however, the meanings are not the same, as our stock ratings are determined on a relative basis. (Please refer to definitions above.) An investor's decision to buy or sell a security should be based on investment objectives, current holdings, and other individual factors.

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See the Companies Mentioned section for full company names. Price Target: (12 months) for (URBN) Method: Our $42 target price for URBN is based on a weighted average of the following analysis: (1) peer group multiples ($42 TP); (2) a five-year DCF ($42 TP); and (3) a long-term growth model ($41 TP). Risks: Risks to URBN's $42 price target include addition fashion risk, which could lead to inventory building, the recent management shuffle leading to a period of transition, the company's inability to come up with new conceps, and risks associated with long-term lease obligations. Please refer to the firm's disclosure website at www.credit-suisse.com/researchdisclosures for the definitions of abbreviations typically used in the target price method and risk sections. See the Companies Mentioned section for full company names. The subject company (URBN) currently is, or was during the 12-month period preceding the date of distribution of this report, a client of Credit Suisse. Credit Suisse provided investment banking services to the subject company (URBN) within the past 12 months. Credit Suisse provided non-investment banking services, which may include Sales and Trading services, to the subject company (URBN) within the past 12 months. Credit Suisse expects to receive or intends to seek investment banking related compensation from the subject company (URBN) within the next 3 months. As of the date of this report, Credit Suisse Securities (USA) LLC makes a market in the securities of the subject company (URBN). Important Regional Disclosures Singapore recipients should contact a Singapore financial adviser for any matters arising from this research report. The analyst(s) involved in the preparation of this report have not visited the material operations of the subject company (URBN) within the past 12 months. Restrictions on certain Canadian securities are indicated by the following abbreviations: NVS--Non-Voting shares; RVS--Restricted Voting Shares; SVS--Subordinate Voting Shares. Individuals receiving this report from a Canadian investment dealer that is not affiliated with Credit Suisse should be advised that this report may not contain regulatory disclosures the non-affiliated Canadian investment dealer would be required to make if this were its own report. For Credit Suisse Securities (Canada), Inc.'s policies and procedures regarding the dissemination of equity research, please visit http://www.csfb.com/legal_terms/canada_research_policy.shtml. The following disclosed European company/ies have estimates that comply with IFRS: HMb.ST, ITX.MC. As of the date of this report, Credit Suisse acts as a market maker or liquidity provider in the equities securities that are the subject of this report.

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Urban Outfitters, Inc. (URBN)

8

12 October 2012

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Urban Outfitters, Inc. (URBN)

9

12 October 2012 Americas/United States Equity Research

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URBN_Pricing_Update_101012.doc

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