UPDATE: Macquarie Upgrades Urban Outfitters

In a research note released Wednesday, Macquarie Research analyst Liz Dunn upgraded Urban Outfitters (NASDAQ: URBN) to Outperform from Neutral and raised its price target from $37.00 to $43.00.

The analyst believes the company's brands have continued to grow and sees strong sales momentum and improved margins. As the back-to-school season starts up again, Dunn believes the company will continue to do well.

In addition, the analyst increased her full-year 2014 earnings per share estimates from $1.96 to $2.00.

Dunn also increased her five-year growth estimate to 17 percent.

The analyst stated, “We believe URBN's long-term growth prospects are intact. The company has fewer stores than most retailers with differentiated products and concepts.”

Shares of the retailer are up 2.24 percent on Wednesday.