Nomura Securities Maintains a 'Neutral' on American Eagle Outfitters (AEO); Follow-up to 2Q Earnings

Nomura Securities maintains a 'Neutral' on American Eagle Outfitters (NYSE: AEO) price target lowered from $15 to $13.

Nomura analyst, Paul Lejuez, said, "Inventory levels are rightfully stealing the headlines, up 35% vs. a 4% increase in sales. We believe this presents a significant margin risk if they have to promote to drive 2H sales. The inventory issue is likely to be an overhang until AEO can demonstrate comp improvement or that GMs can hang in if sales do not materialize. The next data point we get is not until 3Q results (in mid November). We are raising our F11E EPS to $0.80 from $0.64 to reflect the 2Q beat vs. our estimates and stronger than previously forecast comps."

For more ratings news on American Eagle Outfitters click here and for the rating history of American Eagle Outfitters click here.

Shares of American Eagle Outfitters closed at $10.60 yesterday.

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