NYSE:AEO

Stock Analysis Report

American Eagle Outfitters

Executive Summary

American Eagle Outfitters, Inc. operates as a specialty retailer that provides clothing, accessories, and personal care products under the American Eagle and Aerie brands.

Rewards

Trading at 0.05% below its fair value

Pays a high and reliable dividend of 3.71%

Risk Analysis

Earnings are forecast to decline by an average of -6.5% per year for the next 3 years



Snowflake Analysis

6 star dividend payer with excellent balance sheet.


Similar Companies

Share Price & News

How has American Eagle Outfitters's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: AEO has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.6%

AEO

2.6%

US Specialty Retail

1.5%

US Market


1 Year Return

-26.2%

AEO

17.3%

US Specialty Retail

20.1%

US Market

Return vs Industry: AEO underperformed the US Specialty Retail industry which returned 17.3% over the past year.

Return vs Market: AEO underperformed the US Market which returned 20.1% over the past year.


Shareholder returns

AEOIndustryMarket
7 Day3.6%2.6%1.5%
30 Day0.8%0.2%1.4%
90 Day-2.8%4.1%8.7%
1 Year-23.6%-26.2%19.1%17.3%22.7%20.1%
3 Year6.6%-3.1%45.0%38.1%50.1%40.5%
5 Year18.4%1.3%50.0%37.8%73.1%54.1%

Price Volatility Vs. Market

How volatile is American Eagle Outfitters's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is American Eagle Outfitters undervalued compared to its fair value and its price relative to the market?

0.04%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AEO ($14.82) is trading below our estimate of fair value ($14.83)

Significantly Below Fair Value: AEO is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: AEO is good value based on its PE Ratio (9.7x) compared to the Specialty Retail industry average (16.7x).

PE vs Market: AEO is good value based on its PE Ratio (9.7x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: AEO's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: AEO is overvalued based on its PB Ratio (2x) compared to the US Specialty Retail industry average (1.5x).


Next Steps

Future Growth

How is American Eagle Outfitters forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

-6.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AEO's earnings are forecast to decline over the next 3 years (-6.5% per year).

Earnings vs Market: AEO's earnings are forecast to decline over the next 3 years (-6.5% per year).

High Growth Earnings: AEO's earnings are forecast to decline over the next 3 years.

Revenue vs Market: AEO's revenue (3.6% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: AEO's revenue (3.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AEO's Return on Equity is forecast to be low in 3 years time (19.7%).


Next Steps

Past Performance

How has American Eagle Outfitters performed over the past 5 years?

16.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AEO has high quality earnings.

Growing Profit Margin: AEO's current net profit margins (6.2%) are lower than last year (7%).


Past Earnings Growth Analysis

Earnings Trend: AEO's earnings have grown by 16.3% per year over the past 5 years.

Accelerating Growth: AEO's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: AEO had negative earnings growth (-6%) over the past year, making it difficult to compare to the Specialty Retail industry average (5.8%).


Return on Equity

High ROE: AEO's Return on Equity (20.8%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is American Eagle Outfitters's financial position?


Financial Position Analysis

Short Term Liabilities: AEO's short term assets ($1.1B) exceed its short term liabilities ($810.2M).

Long Term Liabilities: AEO's short term assets ($1.1B) do not cover its long term liabilities ($1.4B).


Debt to Equity History and Analysis

Debt Level: AEO is debt free.

Reducing Debt: AEO has not had any debt for past 5 years.

Debt Coverage: AEO has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: AEO has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: AEO has a high level of physical assets or inventory.

Debt Coverage by Assets: AEO's debt is covered by short term assets (assets are 4.7436186176675E+15x debt).


Next Steps

Dividend

What is American Eagle Outfitters's current dividend yield, its reliability and sustainability?

3.71%

Current Dividend Yield


Dividend Yield vs Market

company3.7%marketbottom25%1.4%markettop25%3.7%industryaverage1.8%forecastin3Years4.2%

Current dividend yield vs market & industry

Notable Dividend: AEO's dividend (3.71%) is higher than the bottom 25% of dividend payers in the US market (1.44%).

High Dividend: AEO's dividend (3.71%) is in the top 25% of dividend payers in the US market (3.69%)


Stability and Growth of Payments

Stable Dividend: AEO's dividends per share have been stable in the past 10 years.

Growing Dividend: AEO's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (35.9%), AEO's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AEO's dividends in 3 years are forecast to be covered by earnings (51.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.5yrs

Average management tenure


CEO

Jay Schottenstein (65yo)

6.1yrs

Tenure

US$10,211,180

Compensation

Mr. Jay L. Schottenstein has been Executive Chairman and Director at DSW Inc. since March 2005. Mr. Schottenstein has been the Executive Chairman of American Eagle Outfitters, Inc. since March 1992 and has ...


CEO Compensation Analysis

Compensation vs Market: Jay's total compensation ($USD10.21M) is above average for companies of similar size in the US market ($USD4.88M).

Compensation vs Earnings: Jay's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Jay Schottenstein
Executive Chairman of the Board & CEO6.1yrsUS$10.21m6.13% $151.7m
Robert Madore
Executive VP & CFO3.3yrsUS$4.99m0.0057% $140.3k
Michael Rempell
Executive VP & COO7.7yrsUS$5.31m0.086% $2.1m
Charles Kessler
Executive VP & Global Brand President of American Eagle Outfitters0.7yrsUS$7.06m0.090% $2.2m
Jennifer Foyle
Executive VP & Global Brand President of Aerie0.7yrsUS$6.88m0.049% $1.2m
James Keefer
VP, Chief Accounting Officer & Controller2.3yrsno data0.0051% $126.5k
Judy Meehan
Vice President of Investor Relation20.1yrsno datano data
Jennifer Stoecklein
Senior Director of Governance & Compliance and Corporate Secretary6.4yrsno datano data
Stacy Siegal
Executive VP & General Counsel3.3yrsno data0.0066% $162.1k
Kyle Andrew
Chief Marketing Officer & Executive VP3.7yrsno datano data

3.5yrs

Average Tenure

52yo

Average Age

Experienced Management: AEO's management team is considered experienced (3.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Jay Schottenstein
Executive Chairman of the Board & CEO6.1yrsUS$10.21m6.13% $151.7m
Cary McMillan
Independent Director12.7yrsUS$325.00kno data
Janice Page
Independent Director15.7yrsUS$320.00k0.033% $809.2k
Thomas Ketteler
Independent Director9yrsUS$302.50k0.0054% $133.6k
Deborah Henretta
Independent Director1yrsno datano data
David Sable
Independent Director6.7yrsUS$247.50k0.016% $385.6k
Noel Spiegel
Lead Independent Director2.8yrsUS$395.00kno data
Sujatha Chandrasekaran
Independent Director1.9yrsUS$211.80k0.0096% $238.6k

7.8yrs

Average Tenure

65yo

Average Age

Experienced Board: AEO's board of directors are considered experienced (7.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

American Eagle Outfitters, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: American Eagle Outfitters, Inc.
  • Ticker: AEO
  • Exchange: NYSE
  • Founded: 1977
  • Industry: Apparel Retail
  • Sector: Retail
  • Market Cap: US$2.475b
  • Shares outstanding: 166.98m
  • Website: https://www.aeo-inc.com

Number of Employees


Location

  • American Eagle Outfitters, Inc.
  • 77 Hot Metal Street
  • Pittsburgh
  • Pennsylvania
  • 15203
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AFGDB (Deutsche Boerse AG)YesCommon StockDEEURApr 1994
AEONYSE (New York Stock Exchange)YesCommon StockUSUSDApr 1994

Biography

American Eagle Outfitters, Inc. operates as a specialty retailer that provides clothing, accessories, and personal care products under the American Eagle and Aerie brands. The company also provides jeans, and other apparel and accessories for men and women; and intimates, activewear, and swim collections, as well as personal care products for women. In addition, it offers sports apparel under the Tailgate brand; and menswear products under the Todd Snyder New York brand name. As of March 6, 2019, it operated approximately 934 American Eagle stores, 262 Aerie stores, 5 Tailgate stand-alone stores, and 1 Todd Snyder stand-alone store in the United States, Canada, Mexico, China, and Hong Kong. It also ships to 81 countries through its Websites; and offers its merchandise at 231 locations operated by licensees in 24 countries, as well as provides products through its Websites ae.com, aerie.com, and ToddSnyder.com. American Eagle Outfitters, Inc. was founded in 1977 and is headquartered in Pittsburgh, Pennsylvania. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/17 00:20
End of Day Share Price2020/02/14 00:00
Earnings2019/11/02
Annual Earnings2019/02/02


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.