UPDATE 3-Strong margins, lean inventory drive Urban Outfitters

* Q3 EPS $0.36; Street view $0.35

* Anthropologie Q3 sales up 14 pct

* Expects to open 32-34 new stores in FY

* Inventory down 8 pct

* Shares up more than 2 pct (Recasts; adds analyst comment, byline, changes dateline)

By Shradhha Sharma and Alexandria Sage

BANGALORE/SAN FRANCISCO, Nov 12 (Reuters) - Urban Outfitters Inc's (URBN.O) quarterly profit rose marginally and beat market expectations, driven by strong margins and inventory controls, as well as increased demand at its Anthropologie chain.

Third-quarter sales at Anthropologie, which caters to 30 to 45-year old women, rose 14 percent to $181.6 million.

Shares of the Philadelphia-based company, which have nearly doubled in the last one year, were up more than 2 percent at $33 in Thursday afternoon trade on Nasdaq.

"It's wonderful to see that in such a challenging economic time, a company exceeds last year's profits... Sales in the fourth quarter should be better than the third quarter," Boenning & Scattergood analyst Holly Guthrie said.

The company trimmed its inventories by 8 percent as comparable store inventory declines more than offset additions for new stores.

Urban Outfitters said it was well positioned for the holiday season as total comparable store inventories fell by 15 percent at cost and 8 percent in units.

However, lower inventories could hurt the company as it might signal that fourth quarter may not be as robust as some analysts are expecting, Cowen and Co analyst Laura Champine said.

"It's a pretty solid quarter but people might be spooked by this inventory number."

But, Jefferies & Co analyst Randal Konik said tighter inventories would benefit Urban Outfitters.

"They'll have lower markdowns year-over-year and the company has a flexible supply chain... so they'll be able to chase some business throughout the (fourth) quarter." he said.