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Here's Why American Eagle Outfitters (AEO) Gained But Lagged the Market Today

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American Eagle Outfitters (AEO - Free Report) closed the latest trading day at $21.05, indicating a +0.48% change from the previous session's end. The stock's change was less than the S&P 500's daily gain of 0.97%. Meanwhile, the Dow gained 0.3%, and the Nasdaq, a tech-heavy index, added 1.45%.

The teen clothing retailer's stock has climbed by 10.26% in the past month, exceeding the Retail-Wholesale sector's gain of 7.36% and the S&P 500's gain of 5.41%.

The investment community will be paying close attention to the earnings performance of American Eagle Outfitters in its upcoming release. It is anticipated that the company will report an EPS of $0.47, marking a 4.08% fall compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $1.31 billion, up 0.45% from the prior-year quarter.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $1.78 per share and a revenue of $5.39 billion, signifying shifts of +17.11% and +2.46%, respectively, from the last year.

Investors should also pay attention to any latest changes in analyst estimates for American Eagle Outfitters. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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 last 30 days, the Zacks Consensus EPS estimate has moved 0.16% higher. Currently, American Eagle Outfitters is carrying a Zacks Rank of #3 (Hold).

In the context of valuation, American Eagle Outfitters is at present trading with a Forward P/E ratio of 11.78. This signifies a discount in comparison to the average Forward P/E of 16.65 for its industry.

We can also see that AEO currently has a PEG ratio of 1.04. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Retail - Apparel and Shoes industry held an average PEG ratio of 1.91.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 99, placing it within the top 40% of over 250 industries.

The Zacks Industry Rank gauges the strength of our 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.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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