American Eagle Outfitters Inc. [AEO] – Is this a dead cat bounce or the beginning of a bull run?

American Eagle Outfitters Inc.[AEO] stock saw a move by -3.09% on Wednesday, touching 2.13 million. Based on the recent volume, American Eagle Outfitters Inc. stock traders appear to be active. The most recent trading volume of AEO shares recorded 160.99M shares, which represents the daily volume of traded shares. Analysts estimates state that American Eagle Outfitters Inc. [AEO] stock could reach median target price of $9.50.

American Eagle Outfitters Inc. [AEO] stock additionally went up by 24.96% in the period of the 7 days, recording a gain in performance by 3.19% in the last 30 days. The yearly more of AEO stock is set at -64.63% by far, with shares price recording returns by -43.02% in the latest quarter. Over the past six months, AEO shares showcased -48.25% decrease. AEO saw 24.30 change opposing the low price in the last 12 months, also recording 6.53 compared to high within the same period of time.

American Eagle Outfitters Inc. [NYSE:AEO]: Analyst Rating and Earnings

Equities traders frequently stay up to date regarding what leading market analysts think abopossible stock buy. As it relates to American Eagle Outfitters Inc. [AEO], the latest mean analyst recommendation that’s publicly available is from the fiscal three-month period ending in 1/30/2020. On average, stock market experts give AEO an Hold rating. The average 12-month price forecast for this stock is $8.11, with the high estimate being $17.00, the low estimate being $6.00 and the median estimate amounting to $9.50. This is compared to its latest closing price of $8.41.

Wall Street analysts provide their ratings on a scale of 1 to 5, and the current average score for American Eagle Outfitters Inc. [AEO] is sitting at 3.19. This is compared to 1 month ago, when its average rating was 3.33.

Stay on the lookout for the next quarterly financial report – the company is expected to release the following results on 05/13/2020.

Fundamental Analysis of American Eagle Outfitters Inc. [AEO]

Now let’s turn to look at profitability: with a current Operating Margin for American Eagle Outfitters Inc. [AEO] sitting at 5.40% and its Gross Margin at 35.30%, this company’s Net Margin is now 4.40. These metrics indicate that this company is not generating as much profit, after accounting for expenses, compared to its market peers.

This company’s Return on Total Capital is 15.17, and its Return on Invested Capital has reached 9.97. Its Return on Equity is 15.40%, and its Return on Assets is 5.70%. These metrics all suggest that American Eagle Outfitters Inc. is doing well at using the money it earns to generate returns.

Turning to investigate this organization’s capital structure, American Eagle Outfitters Inc. [AEO] has generated a Total Debt to Total Equity ratio of 128.29. Similarly, its Total Debt to Total Capital is 56.20, while its Total Debt to Total Assets stands at 42.63. Looking toward the future, this publicly-traded company’s Long-Term Debt to Equity is 104.32, and its Long-Term Debt to Total Capital is 45.69.

What about valuation? This company’s Enterprise Value to EBITDA is 5.60. The Enterprise Value to Sales for this firm is now 0.64, and its Total Debt to Enterprise Value stands at 0.44. American Eagle Outfitters Inc. [AEO] has a Price to Book Ratio of 1.93, a Price to Cash Flow Ratio of 3.58 and P/E Ratio of 7.24. These metrics all suggest that American Eagle Outfitters Inc. is more likely to generate a positive ROI.

American Eagle Outfitters Inc. [AEO] has 160.99M shares outstanding, amounting to a total market cap of 1.35B. Its stock price has been found in the range of 6.53 to 24.30. At its current price, it has moved down by -66.46% from its 52-week high, and it has moved up 24.71% from its 52-week low.

This stock’s Beta value is currently 1.09, which indicates that it is 8.46% more volatile that the wider market. This stock’s Relative Strength Index (RSI) is at 46.21. This RSI score is good, suggesting this stock is neither overbought or oversold.

Conclusion: Is American Eagle Outfitters Inc. [AEO] a Reliable Buy?

Shares of American Eagle Outfitters Inc. [AEO], overall, appear to be a solid investment option, with Wall Street analysts expecting its price to rise considerably in the next 12 months. This company generates high value from the labor resources and other capital it has available, and while it has heavy Long-Term Debt to Equity, the majority of the metrics point to this investment being highly attractive.

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Author: Kevin Freeman