February 8, 2024
Top 10 Stock American Eagle Outfitters Strong Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: American Eagle Outfitters – Top 10 Stock in S&P Mid-Cap Index
American Eagle Outfitters is listed as a top 10 stock on February 08, 2024 in the market index S&P MIDCAP because of its high performance in at least one of the Obermatt investment strategies. As all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 93 (top 93% performer), Obermatt assesses an overall strong buy recommendation for American Eagle Outfitters on February 08, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Apparel Retail |
| Index | Dividends USA, S&P MIDCAP |
| Size class | X-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View American Eagle Outfitters Strong Buy
| 360 METRICS | February 8, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 78 |
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| GROWTH | ||||||||
| GROWTH | 99 |
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| SAFETY | ||||||||
| SAFETY | 75 |
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| SENTIMENT | ||||||||
| SENTIMENT | 70 |
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| 360° VIEW | ||||||||
| 360° VIEW | 93 |
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ANALYSIS: With an Obermatt 360° View of 93 (better than 93% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock American Eagle Outfitters are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators above average for American Eagle Outfitters. The consolidated Value Rank has an attractive rank of 78, which means that the share price of American Eagle Outfitters is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 78% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 99, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The company is also safely financed with a Safety rank of 75. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 70. ...read more
RECOMMENDATION: With a consolidated 360° View of 93, American Eagle Outfitters is better positioned than 93% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 78), above-average growth (Growth Rank of 99), safe financing practices (Safety Rank of 75), and a positive market sentiment in the professional investor community (Sentiment Rank of 70), it is a solid stock investment where the risk of paying too much for the shares is limited and disappointments are less likely to occur, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of American Eagle Outfitters is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for American Eagle Outfitters positive
ANALYSIS: With an Obermatt Sentiment Rank of 70 (better than 70% compared with alternatives), overall professional sentiment and engagement for the stock American Eagle Outfitters is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for American Eagle Outfitters. Analyst Opinions are at a rank of 20 (worse than 80% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 94, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in American Eagle Outfitters. More encouragingly, the Professional Investors rank is 92, which means that professional investors hold more stock in this company than in 92% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 48, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 52% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 70 (more positive than 70% compared with investment alternatives), American Eagle Outfitters has a reputation among professional investors that is above-average compared with that of its competitors. The sentiment signals are mixed for American Eagle Outfitters. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: American Eagle Outfitters Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 78 (better than 78% compared with alternatives) for 2023, American Eagle Outfitters shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for American Eagle Outfitters. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 60 which means that the stock price compared with what market professionals expect for future profits is lower than for 60% of comparable companies, indicating a good value concerning American Eagle Outfitters's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 52, and for Dividend Yield with a Dividend Yield Rank of 84. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 60% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 40). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 78, is a buy recommendation based on American Eagle Outfitters's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that American Eagle Outfitters has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing American Eagle Outfitters shares. ...read more
Growth Strategy: American Eagle Outfitters Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 99 (better than 99% compared with alternatives) for 2023, American Eagle Outfitters shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for American Eagle Outfitters. Sales Growth has a value of 50, which means that, currently, professionals expect the company to grow more than 50% of its competitors. The same is valid for Profit Growth with a value of 90 and for Capital Growth with 95. In addition, Stock Returns had an above-average rank value of 89, which means they have been higher than 89% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 99, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, American Eagle Outfitters exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: American Eagle Outfitters Debt Financing Safety very solid
| SAFETY METRICS | February 8, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 81 |
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| REFINANCING | ||||||||
| REFINANCING | 52 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 76 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 75 |
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ANALYSIS: With an Obermatt Safety Rank of 75 (better than 75% compared with alternatives) for 2023, the company American Eagle Outfitters has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of American Eagle Outfitters is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for American Eagle Outfitters. Leverage is at 81, meaning the company has a below-average debt-to-equity ratio. It has less debt than 81% of its competitors. Refinancing is at a rank of 52, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 52% of its competitors. Finally, Liquidity is also good at a rank of 76, which means that the company generates more profit to service its debt than 76% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 75 (better than 75% compared with alternatives), American Eagle Outfitters has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: American Eagle Outfitters Above-Average Financial Performance
| COMBINED PERFORMANCE | February 8, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 78 |
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| GROWTH | ||||||||
| GROWTH | 99 |
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| SAFETY | ||||||||
| SAFETY | 76 |
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| COMBINED | ||||||||
| COMBINED | 67 |
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ANALYSIS: With an Obermatt Combined Rank of 67 (better than 67% compared with investment alternatives), American Eagle Outfitters (Apparel Retail, USA) shares have above-average financial characteristics compared with similar stocks. Shares of American Eagle Outfitters are a good value (attractively priced) with a consolidated Value Rank of 78 (better than 78% of alternatives), show above-average growth (Growth Rank of 99), and are safely financed (Safety Rank of 75), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 67, is a buy recommendation based on American Eagle Outfitters's financial characteristics. As the company American Eagle Outfitters's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 78), above-average growth (Obermatt Growth Rank of 99), and indicate that the company is safely financed (Obermatt Safety Rank of 75), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of American Eagle Outfitters. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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