American Eagle Outfitters Stock NYSE: AEO – “Weekly” Chart
American Eagle’s stock (AEO) is under pressure following the company’s earnings and guidance that missed Wall Street expectations.
Based on market cycles, I believe American Eagle’s stock price will face further downside risks in the coming months.
Our approach to stock analysis uses market cycles to project price action.
Our analysis is that the stock’s “wings were clipped” when it broke below the point at which it started the current cycle, which is a bearish indicator. Our target is below $12.50 by November.
American Eagle Earnings Report Analysis
The company reported earnings per share of $0.39 and total revenue of $1.04 billion, compared to analyst estimates of $0.32 and $1.01 billion. Management projected earnings for the current quarter in the range of $0.47-0.49 below the $0.52 consensus.
CEO Jay Schottenstein explained that, “We are better positioned than ever to capitalize on the continued disruption across the retail industry.” Yet he did not offer an explanation for the lower than expected guidance.
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