Cowen Reiterates Bullish View on American Eagle Outfitters (AEO) on Solid Execution
Cowen reiterated an Outperform rating and $20.00 price target on American Eagle Outfitters (NYSE: AEO) following the company's 3Q earnings report. AEO's 3Q results were driven by strong comp & gross margin performance. Comps were +9% overall, with AE +8% and aerie +21%. Traffic was up y/y during 3Q, and AE store traffic outpaced overall mall traffic.
Management commented on their results over Thanksgiving weekend, through Cyber Monday, noting AEO store comps were up slightly through Monday, and the digital business was exceptionally strong, with both channels combining to deliver a solid positive consolidated comp.
Analyst Oliver Chen commented, "Eagle is Executing: Compelling Product Drives Quality Traffic, Backed by Online Strength. AEO's solid 3Q EPS ($0.35 vs. St. $0.34) on GM +300bp & comps +9% sets them apart from the competition in a tough environment. We are most impressed by: successful pullback of promos throughout Black Fri wknd, online development, & leading denim assortment."
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Shares of American Eagle Outfitters closed at $15.81 yesterday.