In the latest trading session, American Eagle Outfitters (AEO) closed at $19.30, marking a +2.6% move from the previous day. The stock outperformed the S&P 500, which registered a daily gain of 0.6%. Meanwhile, the Dow gained 0.03%, and the Nasdaq, a tech-heavy index, added 1.18%.
The teen clothing retailer's shares have seen an increase of 8.67% over the last month, surpassing the Retail-Wholesale sector's gain of 2.94% and the S&P 500's loss of 0.79%.
Analysts and investors alike will be keeping a close eye on the performance of American Eagle Outfitters in its upcoming earnings disclosure. In that report, analysts expect American Eagle Outfitters to post earnings of $0.49 per share. This would mark a year-over-year decline of 7.55%. Meanwhile, the latest consensus estimate predicts the revenue to be $1.46 billion, indicating a 6.83% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates project earnings of $2.24 per share and a revenue of $5.86 billion, demonstrating changes of +49.33% and +6.63%, respectively, from the preceding year.
Investors should also note any recent changes to analyst estimates for American Eagle Outfitters. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional 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 has remained steady. American Eagle Outfitters is currently sporting a Zacks Rank of #3 (Hold).
Looking at valuation, American Eagle Outfitters is presently trading at a Forward P/E ratio of 8.41. This expresses a discount compared to the average Forward P/E of 14.52 of its industry.
Also, we should mention that AEO has a PEG ratio of 4.29. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Apparel and Shoes industry currently had an average PEG ratio of 1.29 as of yesterday's close.
The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 164, this industry ranks in the bottom 34% of all industries, numbering over 250.
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.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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American Eagle Outfitters, Inc. (AEO): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).