American Eagle Outfitters (AEO) - Get Report rose Thursday after the apparel retailer’s stronger-than-expected business update for the quarter ended May 1 led several analysts to raise their price targets.
The stock was trading at $35.09, up 6% in premarket trading, and has more than doubled over the past six months amid enthusiasm over vaccines and economic recovery.
B. Riley has a buy rating on the stock, and lifted its price target to $40 from $32. The update showed American Eagle is cutting back on clearance and promotions, B. Riley analysts said, according to Bloomberg.
Jefferies has a buy rating and a $39 price target. Pent-up demand in the apparel sector, fiscal stimulus and a fresh fashion cycle will help American Eagle, Jefferies said.
RBC has an outperform rating and raised its price target to $37 from $33. The mid-teens sales growth that the company is enjoying compared to 2019 counts “among the strongest top-line results we’ve seen out of AEO over the past several years,” RBC said.
BMO has a market perform rating and boosted its price target to $36 from $26. It said American Eagle benefits from “tighter industry-wide inventory,” buoyant consumer demand and fiscal stimulus.
Telsey rates American Eagle at market perform and increased its price target to $35 from $28.
A “resurgence” in core denim with new fits and demand for shorts is boosting the company, Telsey said.
American Eagle reported better-than-expected adjusted earnings for the fiscal 2020 fourth quarter ended Feb. 1, helped by strong margins and growth in its Aerie loungewear business. The company posted adjusted fourth-quarter earnings per share of 39 cents on sales of $1.3 billion.