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American Eagle Outfitters (AEO) Stock Declines While Market Improves: Some Information for Investors

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American Eagle Outfitters (AEO - Free Report) closed the most recent trading day at $21.35, moving -1.25% from the previous trading session. The stock trailed the S&P 500, which registered a daily gain of 0.97%. On the other hand, the Dow registered a gain of 0.58%, and the technology-centric Nasdaq increased by 1.39%.

The teen clothing retailer's stock has climbed by 9.03% in the past month, exceeding the Retail-Wholesale sector's loss of 2.12% and the S&P 500's loss of 1.85%.

Market participants will be closely following the financial results of American Eagle Outfitters in its upcoming release. The company plans to announce its earnings on August 29, 2024. The company's upcoming EPS is projected at $0.38, signifying a 52% increase compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $1.31 billion, reflecting an 8.72% rise from the equivalent quarter last year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $1.78 per share and revenue of $5.43 billion, indicating changes of +17.11% and +3.28%, respectively, compared to the previous year.

Investors should also take note of any recent adjustments to analyst estimates for American Eagle Outfitters. These recent revisions tend to reflect the evolving nature of short-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 2.13% higher. At present, American Eagle Outfitters boasts a Zacks Rank of #2 (Buy).

Digging into valuation, American Eagle Outfitters currently has a Forward P/E ratio of 12.12. This represents a discount compared to its industry's average Forward P/E of 16.15.

Also, we should mention that AEO has a PEG ratio of 1.01. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As the market closed yesterday, the Retail - Apparel and Shoes industry was having an average PEG ratio of 1.81.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 175, placing it within the bottom 31% of over 250 industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. 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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