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American Eagle Outfitters (AEO) Dips More Than Broader Markets: What You Should Know

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American Eagle Outfitters (AEO - Free Report) closed the most recent trading day at $24.37, moving -0.61% from the previous trading session. This change lagged the S&P 500's daily loss of 0.1%. Elsewhere, the Dow lost 0.47%, while the tech-heavy Nasdaq lost 0.47%.

Coming into today, shares of the teen clothing retailer had lost 11.48% in the past month. In that same time, the Retail-Wholesale sector lost 0.65%, while the S&P 500 gained 3.67%.

Investors will be hoping for strength from American Eagle Outfitters as it approaches its next earnings release. In that report, analysts expect American Eagle Outfitters to post earnings of $0.46 per share. This would mark year-over-year growth of 17.95%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.55 billion, up 20.29% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.29 per share and revenue of $5.05 billion. These totals would mark changes of +1045% and +34.33%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for American Eagle Outfitters. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.27% higher within the past month. American Eagle Outfitters is currently a Zacks Rank #3 (Hold).

Investors should also note American Eagle Outfitters's current valuation metrics, including its Forward P/E ratio of 10.71. For comparison, its industry has an average Forward P/E of 12.78, which means American Eagle Outfitters is trading at a discount to the group.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 42, putting it in the top 17% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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