I'm feeling queasy also. The technicals are breaking down and the stock is about to go below the 200MA. AEO is my biggest holding. What makes it more difficult is trying to figure out the reason for the drop. It may be the feeling AEO will lower Q4 guidance because of Sandy since they have above-average number of stores on Eastern Seaboard. I'm still hoping for an upside surprise on 11/26 when they report since reiterated Q3 estimates in line with analysts but not holding my breath. I don't believe we're in for another special dividend.
Sandy will only help this stock, if anyone thinks the people living on Rockaway Beach were shopping at AEO, they have no idea what they are talking about. The families who shop at AEO that lost their house have insurance and will have to replace EVERYTHING. AEO will raise guidance. I think this is a power play to squeeze the retailer out. I'm holding expecting a big pop but I could be wrong.