American Eagle Outfitters (AEO) Gains But Lags Market: What You Should Know
American Eagle Outfitters (AEO) closed at $22.84 in the latest trading session, marking a +0.75% move from the prior day. This move lagged the S&P 500's daily gain of 1.58%. Elsewhere, the Dow gained 1.22%, while the tech-heavy Nasdaq added 0.46%.
Prior to today's trading, shares of the teen clothing retailer had lost 4.55% over the past month. This has lagged the Retail-Wholesale sector's loss of 4.2% and was narrower than the S&P 500's loss of 5.54% in that time.
Wall Street will be looking for positivity from American Eagle Outfitters as it approaches its next earnings report date. On that day, American Eagle Outfitters is projected to report earnings of $0.38 per share, which would represent a year-over-year decline of 2.56%. Our most recent consensus estimate is calling for quarterly revenue of $1.53 billion, up 18.43% from the year-ago period.
Investors should also note any recent changes to analyst estimates for American Eagle Outfitters. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. American Eagle Outfitters currently has a Zacks Rank of #3 (Hold).
In terms of valuation, American Eagle Outfitters is currently trading at a Forward P/E ratio of 9.42. Its industry sports an average Forward P/E of 10.71, so we one might conclude that American Eagle Outfitters is trading at a discount comparatively.
The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 174, which puts it in the bottom 32% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
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