Standpoint Research Downgrades American Eagle Outfitters (AEO) to Hold; Moving to Sidelines After Recent Run

Standpoint Research downgraded American Eagle Outfitters (NYSE: AEO) from Buy to Hold.

Standpoint analyst, Ronnie Moas, said, "American Eagle shares have jumped 50% since late August and outperformed the S&P-500 by more than 4000 bps during that time. Now trading at 15X earnings...given the recent absolute and relative moves...and high cotton price and promotions squeezing margins, we will watch this from the sidelines with the risk-reward in the near-term preventing us from leaving our highest recommendation attached to this name."

"Short interest is low, sentiment is bullish and there was heavy insider buying...but that was in September at $11...There have been constant takeover rumors surrounding this name and we have a policy here of disregarding speculation and rumors of this nature because 80%-90% of the time it is baseless and/or does not materialize."

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 $15.02 yesterday.

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