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Should Value Investors Buy American Eagle Outfitters (AEO) Stock?
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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is American Eagle Outfitters (AEO - Free Report) . AEO is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 14.07 right now. For comparison, its industry sports an average P/E of 17.39. Over the past 52 weeks, AEO's Forward P/E has been as high as 16.30 and as low as 9.32, with a median of 13.32.
Another notable valuation metric for AEO is its P/B ratio of 2.78. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 4.48. Over the past year, AEO's P/B has been as high as 2.94 and as low as 1.24, with a median of 1.91.
Finally, investors will want to recognize that AEO has a P/CF ratio of 12.06. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 15.33. AEO's P/CF has been as high as 12.75 and as low as 6.01, with a median of 7.84, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that American Eagle Outfitters is likely undervalued currently. And when considering the strength of its earnings outlook, AEO sticks out at as one of the market's strongest value stocks.
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Should Value Investors Buy American Eagle Outfitters (AEO) Stock?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is American Eagle Outfitters (AEO - Free Report) . AEO is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 14.07 right now. For comparison, its industry sports an average P/E of 17.39. Over the past 52 weeks, AEO's Forward P/E has been as high as 16.30 and as low as 9.32, with a median of 13.32.
Another notable valuation metric for AEO is its P/B ratio of 2.78. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 4.48. Over the past year, AEO's P/B has been as high as 2.94 and as low as 1.24, with a median of 1.91.
Finally, investors will want to recognize that AEO has a P/CF ratio of 12.06. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 15.33. AEO's P/CF has been as high as 12.75 and as low as 6.01, with a median of 7.84, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that American Eagle Outfitters is likely undervalued currently. And when considering the strength of its earnings outlook, AEO sticks out at as one of the market's strongest value stocks.