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Category: Stock Market and American Eagle
Date: 13 January 2020 Stock Price: $14.54 We take a look at the news released today by American Eagle Outfitters that the group reaffirms its 4th quarter 2019 fiscal guidance of between $0.34 and $0.36 a share
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About American Eagle Outfitters
American Eagle Outfitters, Inc. (NYSE: AEO) is a leading global specialty retailer offering high-quality, on-trend clothing, accessories and personal care products at affordable prices under its American Eagle Outfitters® and Aerie® brands. The company operates more than 1,000 stores in the United States, Canada, Mexico, China and Hong Kong, and ships to 81 countries worldwide through its websites. American Eagle Outfitters and Aerie merchandise also is available at more than 200 international locations operated by licensees in 25 countries
The press release from Anerican Eagle Outfitters
PITTSBURGH--(BUSINESS WIRE)-- American Eagle Outtters, Inc. (NYSE:AEO) today announced that fourth quarter comparable sales to date are approximately at, following a 6% comp increase last year. The company rearms its previously issued fourth quarter EPS guidance in the range of $0.34 to $0.36 per diluted share. This guidance excludes potential asset impairment and restructuring charges. “Despite some expected challenges, we delivered another holiday season of record revenue, driven by strength in the Aerie brand and American Eagle’s signature jeans collections,” commented Jay Schottenstein, AEO’s Chief Executive Ocer. “We look forward to the new scal year, as we continue to fuel our growth pillars, while positioning AEO for greater success and improved protability.” The company will release fourth quarter and scal 2019 results on March 4, 2020 and will host a conference call to review nancial results on that date.
American Eagle Outfitters (NYSE: AEO) stock price history
The image below, obtained from Google shows the stock price history of American Eagle Outfitters for the last 5 years. And the stock hasn't done much in terms of returns offers to investors over the last 5 years, with the price increasing from around $14, 5 years ago to $14.55 its trading at right now. It has seen major ups and downs over the 5 year period but in all hasn't changed much over a 5 year period. It is also trading at a lot close to its 52 week low of $13.66 than it is to its 52 week high of $24.30 which to us is a clear signal that the short term sentiment and momentum of American Eagle Outfitters stock is negative.
American Eagle Outfitters (NYSE: AEO) latest stock valuation (as at 14 December 2019)
So based on American Eagle Outfitters latest earnings report what do we value the stock price at? Based on the group's latest earnings report and their fiscal guidance provided our valuation model provides a target price (full value price) for American Eagle Outfitters at $21.80 a stock. We therefore believe American Eagle Outfitters stock is undervalued and we expect the stock price to tick upwards in coming weeks and months.
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price) which in this case is $21.80. A good entry point into the stock of American Eagle Outfitters would therefore be at $19.60 or below.
Since the stock of American Eagle Outfitters is trading at well below our suggested entry point into the stock we rate the stock of American Eagle Outfitters as a buy
See this earnings review here
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price) which in this case is $21.80. A good entry point into the stock of American Eagle Outfitters would therefore be at $19.60 or below.
Since the stock of American Eagle Outfitters is trading at well below our suggested entry point into the stock we rate the stock of American Eagle Outfitters as a buy
See this earnings review here