American Eagle Meets Views

The company says November sales trends are 'slightly positive.'
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American Eagle Outfitters (AEO) - Get Report reported third-quarter earnings in line with its lowered guidance and offered a relatively tepid forecast for the fourth quarter.

For the period ended Nov. 3, American Eagle's profit slipped to $99.4 million from $100.9 million a year earlier. On a per-share basis, earnings rose to 45 cents from 44 cents due to fewer shares outstanding.

In October, American Eagle lowered its third-quarter profit forecast to 44 cents to 45 cents a share from its initial view of 47 cents to 48 cents. The company, like many retailers, was hit by weaker-than-expected sales in September and October as warm weather kept fall clothing on the shelves.

American Eagle's sales for the quarter increased 7% to $744.4 million. Same-store sales, representing sales at stores open at least a year, rose 2%.

Gross profit margins slipped to 47.4% from 49.5% last year, primarily because of higher markdowns to move product.

For the fourth quarter, the Pittsburgh-based retailer expects earnings of 67 cents to 70 cents a share, which would meet or fall below Wall Street's 70-cent estimates.

American Eagle said its month-to-date same-store sales have been slightly positive, and the company said it was "pleased" with the Thanksgiving weekend and traffic trends.

Shares of American Eagle recently were up 17 cents to $21.54.