American Eagle revenue of $1.19 billion missed analysts' expectations of $1.23 billion, although earnings topped expectations.
Analysts were looking for a better sales figure ahead of the back-to-school season and as the economy continues to rebound.
Is the selloff an overreaction? Perhaps, particularly as American Eagle stock was already down 23.2% from the 2021 high ahead of the print. It’s even got one Real Money contributor buying today's pullback.
Let’s look at a key support area that the stock is trying to hold.
Trading American Eagle Stock
American Eagle stock topped a penny shy of $39 earlier this summer before embarking on a multi-month decline. Amid that slide, the stock lost all of its daily moving averages.
Now sitting near $27.50, shares are holding a key level on the chart.
Although the stock slightly broke below both measures, American Eagle has reclaimed the 50-week moving average and the 61.8% retracement of its range from the 2020 low to the 2021 high.
For those that are aggressive and want to be long this name, they can use a close below Thursday’s low as their stop-loss.
A break of that level could put $25 on deck.
On the upside, a move over Thursday’s high (currently at) $28.37 could open the door to the 200-day moving average. Above that and the gap-fill mark near $30 is possible.
It has not been an easy ride for American Eagle stock lately.
Not only is the stock down big from the highs a few months ago, but it’s putting in its fourth straight daily decline and sixth loss in the last seven trading sessions.