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Here's What Makes American Eagle (AEO) Stock a Promising Bet
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American Eagle Outfitters, Inc. (AEO - Free Report) stock has been doing quite well on the bourses, thanks to its solid business strategies. The company is benefiting from brand strength and robust demand for its products that resonate well with customers. Overall, management is focused on creating a trend-right merchandise assortment, deepening relations with customers via marketing, enhancing the digital commerce agenda and efficiently controlling expenses.
Buoyed by such strengths, shares of this apparel and footwear dealer have surged a whopping 72.4% compared with the industry’s 36.5% growth in a year. A VGM Score of A adds strength to this Zacks Rank #1 (Strong Buy) company.
Let’s Delve Deeper
American Eagle is on track with its Real Power Real Growth value-creation plan, which has been aiding the company’s performance for a while now. The plan is driving profitability through real estate and inventory-optimization efforts, omnichannel and customer focus, and investments to improve the supply chain. As part of the aforesaid initiative, American Eagle will continue to pursue opportunities to grow the Aerie brand through expansion into newer markets, innovation and a wider customer base. Management also expects to undertake initiatives to deliver growth and sustained profitability for the American Eagle brand.
Image Source: Zacks Investment Research
American Eagle’s Aerie brand has also been exhibiting momentum for quite some time now. Sturdy demand in its core apparel, activewear extension, strength in the OFFLINE brand and renewed momentum in intimates is aiding the brand’s growth. Strength in its core apparel collection, particularly in fleece, bottoms and tops, is acting as a major growth driver. Also, its activewear extension, OFFLINE by Aerie, bodes well on the back of tops, sports bras, active shorts and fashion items.
The Aerie brand is a key growth engine for American Eagle and remains on track to reach the next brand milestone of $2 billion in sales. Further, the company’s profit-improvement endeavors have been paying off. This, along with lower delivery, distribution and warehousing costs, has been boosting margins. Also, higher merchandising margins from lower markdowns stemming from inventory control, and lower transportation and product costs are other positives.
Analysts seem quite optimistic about Aerie’s parent company. The Zacks Consensus Estimate for fiscal 2024 sales and earnings per share (EPS) is currently pegged at $5.4 billion and $1.64, respectively. These estimates show corresponding growth of 3.3% and 7.9% year over year.
The consensus estimate for fiscal 2025 sales and EPS is $5.6 billion and $1.85, respectively, mirroring year-over-year increases of 3.2% and 12.5%. Given all the positives, American Eagle stock seems to deserve a place in your investment portfolio.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales suggests growth of 5.7% from the year-ago reported figure. ANF delivered an earnings surprise of 715.6% over the trailing four quarters.
Gap, a fashion retailer of apparel and accessories, presently flaunts a Zacks Rank of 1. The company has a trailing four-quarter earnings surprise of 180.9%, on average.
The Zacks Consensus Estimate for Gap’s current financial-year EPS suggests growth of 11.1%, from the year-ago reported figure.
Hibbett, a key sporting goods retailer, currently carries a Zacks Rank #2 (Buy). HIBB delivered an earnings surprise of 24.2% in the trailing four quarters.
The Zacks Consensus Estimate for Hibbett’s current financial-year sales suggests growth of 1.8% from the year-ago reported figure.
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Here's What Makes American Eagle (AEO) Stock a Promising Bet
American Eagle Outfitters, Inc. (AEO - Free Report) stock has been doing quite well on the bourses, thanks to its solid business strategies. The company is benefiting from brand strength and robust demand for its products that resonate well with customers. Overall, management is focused on creating a trend-right merchandise assortment, deepening relations with customers via marketing, enhancing the digital commerce agenda and efficiently controlling expenses.
Buoyed by such strengths, shares of this apparel and footwear dealer have surged a whopping 72.4% compared with the industry’s 36.5% growth in a year. A VGM Score of A adds strength to this Zacks Rank #1 (Strong Buy) company.
Let’s Delve Deeper
American Eagle is on track with its Real Power Real Growth value-creation plan, which has been aiding the company’s performance for a while now. The plan is driving profitability through real estate and inventory-optimization efforts, omnichannel and customer focus, and investments to improve the supply chain. As part of the aforesaid initiative, American Eagle will continue to pursue opportunities to grow the Aerie brand through expansion into newer markets, innovation and a wider customer base. Management also expects to undertake initiatives to deliver growth and sustained profitability for the American Eagle brand.
Image Source: Zacks Investment Research
American Eagle’s Aerie brand has also been exhibiting momentum for quite some time now. Sturdy demand in its core apparel, activewear extension, strength in the OFFLINE brand and renewed momentum in intimates is aiding the brand’s growth. Strength in its core apparel collection, particularly in fleece, bottoms and tops, is acting as a major growth driver. Also, its activewear extension, OFFLINE by Aerie, bodes well on the back of tops, sports bras, active shorts and fashion items.
The Aerie brand is a key growth engine for American Eagle and remains on track to reach the next brand milestone of $2 billion in sales. Further, the company’s profit-improvement endeavors have been paying off. This, along with lower delivery, distribution and warehousing costs, has been boosting margins. Also, higher merchandising margins from lower markdowns stemming from inventory control, and lower transportation and product costs are other positives.
Analysts seem quite optimistic about Aerie’s parent company. The Zacks Consensus Estimate for fiscal 2024 sales and earnings per share (EPS) is currently pegged at $5.4 billion and $1.64, respectively. These estimates show corresponding growth of 3.3% and 7.9% year over year.
The consensus estimate for fiscal 2025 sales and EPS is $5.6 billion and $1.85, respectively, mirroring year-over-year increases of 3.2% and 12.5%. Given all the positives, American Eagle stock seems to deserve a place in your investment portfolio.
Eye These Other Key Picks
We have highlighted three other top-ranked stocks, namely Abercrombie & Fitch (ANF - Free Report) , Gap (GPS - Free Report) and Hibbett (HIBB - Free Report) .
Abercrombie & Fitch, a leading casual apparel retailer, currently sports a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales suggests growth of 5.7% from the year-ago reported figure. ANF delivered an earnings surprise of 715.6% over the trailing four quarters.
Gap, a fashion retailer of apparel and accessories, presently flaunts a Zacks Rank of 1. The company has a trailing four-quarter earnings surprise of 180.9%, on average.
The Zacks Consensus Estimate for Gap’s current financial-year EPS suggests growth of 11.1%, from the year-ago reported figure.
Hibbett, a key sporting goods retailer, currently carries a Zacks Rank #2 (Buy). HIBB delivered an earnings surprise of 24.2% in the trailing four quarters.
The Zacks Consensus Estimate for Hibbett’s current financial-year sales suggests growth of 1.8% from the year-ago reported figure.