Back to top

Image: Bigstock

American Eagle Outfitters (AEO) Beats Stock Market Upswing: What Investors Need to Know

Read MoreHide Full Article

American Eagle Outfitters (AEO - Free Report) ended the recent trading session at $12.03, demonstrating a +2.47% change from the preceding day's closing price. The stock outpaced the S&P 500's daily gain of 0.02%. On the other hand, the Dow registered a loss of 0.14%, and the technology-centric Nasdaq increased by 0.33%.

The stock of teen clothing retailer has risen by 18.83% in the past month, leading the Retail-Wholesale sector's gain of 4.9% and the S&P 500's gain of 4.93%.

The investment community will be paying close attention to the earnings performance of American Eagle Outfitters in its upcoming release. The company's earnings per share (EPS) are projected to be $0.2, reflecting a 48.72% decrease from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $1.23 billion, indicating a 4.49% decline compared to the corresponding quarter of the prior year.

AEO's full-year Zacks Consensus Estimates are calling for earnings of $0.83 per share and revenue of $5.19 billion. These results would represent year-over-year changes of -52.3% and -2.57%, respectively.

It is also important to note the recent changes to analyst estimates for American Eagle Outfitters. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. American Eagle Outfitters is currently a Zacks Rank #5 (Strong Sell).

In the context of valuation, American Eagle Outfitters is at present trading with a Forward P/E ratio of 14.15. This valuation marks a discount compared to its industry average Forward P/E of 18.98.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 214, putting it in the bottom 14% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


American Eagle Outfitters, Inc. (AEO) - free report >>

Published in