Mizuho Securities Remains Sidelined on American Eagle Outfitters (AEO) Following Holiday Season

Mizuho Securities maintained a Neutral rating on American Eagle Outfitters (NYSE: AEO), and cut the price target to $16.00 (from $18.00), following the company's challenging Holiday season. AEO reported QTD comps of flat vs. +4% LY, below 4Q forecast of +2% and Street’s’ +1.7%.

Analyst Betty Chen commented, "We are moderating our 4Q/FY17 estimates and PT to $16 (from $18) to reflect a challenging Holiday season that raises concerns about core AE’s ability to comp in FY17 against tougher compares. With decelerating trends through the bulk of 4Q, we fear current plans to drive sales through higher AUR may be difficult to sustain at core AE (Aerie likely driving positive comp growth). Moreover, we note the rate of margin improvement may begin to diminish, particularly given mix towards higher AUR products that may be more susceptible to markdowns, especially with lingering ARO liquidation impact. With few near-term catalysts, we are maintaining our neutral stance and expect shares to remain range-bound."

For an analyst ratings summary and ratings history on American Eagle Outfitters click here. For more ratings news on American Eagle Outfitters click here.

Shares of American Eagle Outfitters closed at $15.64 yesterday.

You May Also Be Interested In

• Quest Diagnostics (DGX) PT Raised to $145 at Evercore ISI
• Costco Wholesale (COST) PT Raised to $710 at Citi
• Euronext NV (ENX:FP) (EUXTF) PT Lowered to EUR108 at Citi