Goldman Sachs Upgrades American Eagle Outfitters (AEO) to Buy

Goldman Sachs upgraded American Eagle Outfitters (NYSE: AEO) from Neutral to Buy with a price target of $16.00. Analyst Lindsay Drucker Mann thinks margins are set to recover.

"Stronger realized pricing and tighter inventories during the back-to-school season support a stabilization in comp sales and improved merchandise margins. Margin improvement is further supported by AEO's focus on operating expense control. We expect shares will outperform as out-year EPS projections are revised higher (our FY15 forecast is 25% above consensus) and improved sentiment drives multiple expansion toward 17X," said Drucker Mann.

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 $14.43 yesterday.

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