January 2, 2025
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 Dividend Champions United States
American Eagle Outfitters is listed as a top 10 stock on January 02, 2025 in the market index Dividends USA because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment from a financial fact perspective where only investor sentiment is a reason for caution. Based on the Obermatt 360° View of 100 (top 100% performer), Obermatt assesses an overall strong buy recommendation for American Eagle Outfitters on January 02, 2025.
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 | January 2, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 89 |
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| GROWTH | ||||||||
| GROWTH | 61 |
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| SAFETY | ||||||||
| SAFETY | 66 |
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| SENTIMENT | ||||||||
| SENTIMENT | 21 |
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| 360° VIEW | ||||||||
| 360° VIEW | 100 |
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ANALYSIS: With an Obermatt 360° View of 100 (better than 100% compared with alternatives) for 2024, 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 three out of four indicators above average for American Eagle Outfitters. The consolidated Value Rank has an attractive rank of 89, 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 89% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 61, 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 66. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of only 21. Professional investors are more confident in 79% other stocks. ...read more
RECOMMENDATION: With a consolidated 360° View of 100, American Eagle Outfitters is better positioned than 100% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 89), above-average growth (Growth Rank of 61), and safe financing practices (Safety Rank of 66), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the professional market sentiment is on the riskier side (Sentiment Rank of 21), but that could also mean an overreaction to negative news in the past. Good value is sometimes an indication that the company's future is challenging. If they have been enjoying above average growth and are still a good value, this may not continue. We recommend evaluating whether the future of American Eagle Outfitters is as challenging as the low price of the stock despite good growth and safe financing practices suggest. Since the professional community is pessimistic, you may want to reflect these negative opinions in light of what you find reasonable to expect for the future. If you believe this pessimistic view is transitory, you have a solid investment case based on current financial factors. ...read more
Sentiment Strategy: Professional Market Sentiment for American Eagle Outfitters negative
ANALYSIS: With an Obermatt Sentiment Rank of 21 (better than 21% compared with alternatives), overall professional sentiment and engagement for the stock American Eagle Outfitters is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and half above average for American Eagle Outfitters. Analyst Opinions are at a rank of 16 (worse than 84% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 3, which means that stock research experts are getting even more pessimistic. In addition, the Professional Investors rank is 29, which means that professional investors hold less stock in this company than in 71% of alternative investment opportunities. Pros tend to invest in other companies. The only positive sentiment indicator for American Eagle Outfitters is Market Pulse, with a rank of 86, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 86% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 21 (less encouraging than 79% compared with investment alternatives), American Eagle Outfitters has a reputation among professional investors that is far below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: American Eagle Outfitters Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 89 (better than 89% compared with alternatives) for 2024, American Eagle Outfitters shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for American Eagle Outfitters. Price-to-Sales is 50 which means that the stock price compared with what market professionals expect for future sales is lower than for 50% of comparable companies, indicating a good value for American Eagle Outfitters's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 87% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 53. Compared with other companies in the same industry, dividend yields of American Eagle Outfitters are expected to be higher than for 92% of all competitors (a Dividend Yield rank of 92). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 89, is a buy recommendation based on American Eagle Outfitters's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in American Eagle Outfitters based on its detailed value metrics.
Growth Strategy: American Eagle Outfitters Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 61 (better than 61% compared with alternatives), American Eagle Outfitters shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, where half of the indicators are below and half above average for American Eagle Outfitters. Profit Growth, with a rank of 69 (better than 69% of its competitors), and Capital Growth, with a rank of 75, are both positive, which is a healthy sign for positive development. But Sales Growth has only a rank of 49, which means that, currently, professionals expect the company to grow less than 51% of its competitors, and Stock Returns are at a rank of 33. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 61, is a buy recommendation for growth and momentum investors. Stock returns that are a thing of the past can be less of a problem. Below-average revenue growth may be caused by divestments of underperforming businesses. If that is the case, then the positive developments of profit and capital growth are signs of a company with growth potential. If these are the reasons, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: American Eagle Outfitters Debt Financing Safety above-average
| SAFETY METRICS | January 2, 2025 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 100 |
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| REFINANCING | ||||||||
| REFINANCING | 67 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 1 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 66 |
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ANALYSIS: With an Obermatt Safety Rank of 66 (better than 66% compared with alternatives), the company American Eagle Outfitters has financing practices on the safer side, which mean that their overall debt burden is lower than average. 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 two out of three are above average for American Eagle Outfitters.Leverage is at 100, meaning the company has a below-average debt-to-equity ratio. It has less debt than 100% of its competitors.Refinancing is at a rank of 67, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 67% of its competitors. Liquidity is at 1, meaning that the company generates less profit to service its debt than 99% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 66 (better than 66% compared with alternatives), American Eagle Outfitters has a financing structure that is safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: American Eagle Outfitters Top Financial Performance
| COMBINED PERFORMANCE | January 2, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 89 |
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| GROWTH | ||||||||
| GROWTH | 61 |
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| SAFETY | ||||||||
| SAFETY | 1 |
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| COMBINED | ||||||||
| COMBINED | 98 |
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ANALYSIS: With an Obermatt Combined Rank of 98 (better than 98% compared with investment alternatives), American Eagle Outfitters (Apparel Retail, USA) shares have much better financial characteristics than comparable stocks. Shares of American Eagle Outfitters are a good value (attractively priced) with a consolidated Value Rank of 89 (better than 89% of alternatives), show above-average growth (Growth Rank of 61), and are safely financed (Safety Rank of 66), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 98, is a strong 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 89), above-average growth (Obermatt Growth Rank of 61), and indicate that the company is safely financed (Obermatt Safety Rank of 66), 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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