AMERICAN EAGLE OUTFITTERS (AEO) Stock Fundamental Analysis
NYSE:AEO - New York Stock Exchange, Inc. - US02553E1064 - Common Stock
AEO gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 119 industry peers in the Specialty Retail industry. AEO is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. AEO is valued quite cheap, while showing a decent growth score. This is a good combination! This makes AEO very considerable for value investing!
1. Profitability
1.1 Basic Checks
AEO had positive earnings in the past year.
AEO had a positive operating cash flow in the past year.
AEO had positive earnings in 4 of the past 5 years.
Each year in the past 5 years AEO had a positive operating cash flow.
1.2 Ratios
AEO has a Return On Assets of 7.01%. This is in the better half of the industry: AEO outperforms 76.72% of its industry peers.
The Return On Equity of AEO (14.64%) is better than 72.41% of its industry peers.
AEO has a better Return On Invested Capital (11.14%) than 75.86% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AEO is in line with the industry average of 12.38%.
The 3 year average ROIC (10.41%) for AEO is below the current ROIC(11.14%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.01% | ||
| ROE | 14.64% | ||
| ROIC | 11.14% |
ROA(3y)6.51%
ROA(5y)3.83%
ROE(3y)15.7%
ROE(5y)8.63%
ROIC(3y)10.41%
ROIC(5y)8.01%
1.3 Margins
AEO's Profit Margin of 4.58% is fine compared to the rest of the industry. AEO outperforms 76.72% of its industry peers.
AEO's Profit Margin has declined in the last couple of years.
AEO has a better Operating Margin (8.01%) than 80.17% of its industry peers.
In the last couple of years the Operating Margin of AEO has declined.
AEO has a Gross Margin of 39.18%. This is comparable to the rest of the industry: AEO outperforms 58.62% of its industry peers.
AEO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.01% | ||
| PM (TTM) | 4.58% | ||
| GM | 39.18% |
OM growth 3Y212.88%
OM growth 5Y-3.77%
PM growth 3YN/A
PM growth 5Y-13.02%
GM growth 3Y8%
GM growth 5Y0.86%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), AEO is creating some value.
AEO has more shares outstanding than it did 1 year ago.
AEO has more shares outstanding than it did 5 years ago.
AEO has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
AEO has an Altman-Z score of 4.08. This indicates that AEO is financially healthy and has little risk of bankruptcy at the moment.
AEO has a Altman-Z score of 4.08. This is amongst the best in the industry. AEO outperforms 81.90% of its industry peers.
There is no outstanding debt for AEO. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 4.08 |
ROIC/WACC1.08
WACC10.27%
2.3 Liquidity
AEO has a Current Ratio of 1.57. This is a normal value and indicates that AEO is financially healthy and should not expect problems in meeting its short term obligations.
AEO's Current ratio of 1.57 is fine compared to the rest of the industry. AEO outperforms 65.52% of its industry peers.
AEO has a Quick Ratio of 1.57. This is a bad value and indicates that AEO is not financially healthy enough and could expect problems in meeting its short term obligations.
With a decent Quick ratio value of 0.74, AEO is doing good in the industry, outperforming 65.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.57 | ||
| Quick Ratio | 0.74 |
3. Growth
3.1 Past
AEO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 51.24%, which is quite impressive.
The Earnings Per Share has been growing slightly by 0.53% on average over the past years.
AEO shows a small growth in Revenue. In the last year, the Revenue has grown by 7.90%.
The Revenue has been growing slightly by 5.45% on average over the past years.
EPS 1Y (TTM)51.24%
EPS 3YN/A
EPS 5Y0.53%
EPS Q2Q%56%
Revenue 1Y (TTM)7.9%
Revenue growth 3Y11.86%
Revenue growth 5Y5.45%
Sales Q2Q%7.51%
3.2 Future
Based on estimates for the next years, AEO will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.66% on average per year.
The Revenue is expected to grow by 3.01% on average over the next years.
EPS Next Y12.08%
EPS Next 2Y10.01%
EPS Next 3Y10.66%
EPS Next 5YN/A
Revenue Next Year1.51%
Revenue Next 2Y2.42%
Revenue Next 3Y3.01%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 9.42, which indicates a very decent valuation of AEO.
AEO's Price/Earnings ratio is rather cheap when compared to the industry. AEO is cheaper than 92.24% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.29. AEO is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 9.37, which indicates a very decent valuation of AEO.
Based on the Price/Forward Earnings ratio, AEO is valued cheaply inside the industry as 89.66% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of AEO to the average of the S&P500 Index (24.44), we can say AEO is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.42 | ||
| Fwd PE | 9.37 |
4.2 Price Multiples
93.97% of the companies in the same industry are more expensive than AEO, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, AEO is valued cheaply inside the industry as 84.48% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.88 | ||
| EV/EBITDA | 4.69 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
AEO has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)0.78
PEG (5Y)17.62
EPS Next 2Y10.01%
EPS Next 3Y10.66%
5. Dividend
5.1 Amount
AEO has a Yearly Dividend Yield of 3.21%.
AEO's Dividend Yield is rather good when compared to the industry average which is at 3.27. AEO pays more dividend than 90.52% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, AEO pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.21% |
5.2 History
The dividend of AEO decreases each year by -5.09%.
AEO has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of AEO decreased recently.
Dividend Growth(5Y)-5.09%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
37.51% of the earnings are spent on dividend by AEO. This is a low number and sustainable payout ratio.
DP37.51%
EPS Next 2Y10.01%
EPS Next 3Y10.66%
AMERICAN EAGLE OUTFITTERS
NYSE:AEO (1/21/2025, 8:04:00 PM)
After market: 17.25 +0.01 (+0.06%)17.24
+1.21 (+7.55%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners105.11%
Inst Owner Change0.01%
Ins Owners6%
Ins Owner Change-0.93%
Market Cap3.31B
Analysts66.25
Price Target21.73 (26.04%)
Short Float %6.94%
Short Ratio2.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.21% |
Yearly Dividend0.43
Dividend Growth(5Y)-5.09%
DP37.51%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.32%
Min EPS beat(2)0.71%
Max EPS beat(2)19.93%
EPS beat(4)4
Avg EPS beat(4)10.75%
Min EPS beat(4)0.71%
Max EPS beat(4)21.64%
EPS beat(8)8
Avg EPS beat(8)26.2%
EPS beat(12)9
Avg EPS beat(12)10.4%
EPS beat(16)13
Avg EPS beat(16)9.07%
Revenue beat(2)0
Avg Revenue beat(2)-1.99%
Min Revenue beat(2)-2.41%
Max Revenue beat(2)-1.56%
Revenue beat(4)1
Avg Revenue beat(4)-0.83%
Min Revenue beat(4)-2.41%
Max Revenue beat(4)0.86%
Revenue beat(8)4
Avg Revenue beat(8)-0.27%
Revenue beat(12)5
Avg Revenue beat(12)-0.85%
Revenue beat(16)6
Avg Revenue beat(16)-0.92%
PT rev (1m)-9.36%
PT rev (3m)-10.42%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.81%
EPS NY rev (1m)0%
EPS NY rev (3m)-6%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.45%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.42 | ||
| Fwd PE | 9.37 | ||
| P/S | 0.61 | ||
| P/FCF | 11.88 | ||
| P/OCF | 7 | ||
| P/B | 1.95 | ||
| P/tB | 2.32 | ||
| EV/EBITDA | 4.69 |
EPS(TTM)1.83
EY10.61%
EPS(NY)1.84
Fwd EY10.67%
FCF(TTM)1.45
FCFY8.42%
OCF(TTM)2.46
OCFY14.28%
SpS28.19
BVpS8.82
TBVpS7.42
PEG (NY)0.78
PEG (5Y)17.62
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.01% | ||
| ROE | 14.64% | ||
| ROCE | 15.8% | ||
| ROIC | 11.14% | ||
| ROICexc | 11.98% | ||
| ROICexgc | 13.39% | ||
| OM | 8.01% | ||
| PM (TTM) | 4.58% | ||
| GM | 39.18% | ||
| FCFM | 5.15% |
ROA(3y)6.51%
ROA(5y)3.83%
ROE(3y)15.7%
ROE(5y)8.63%
ROIC(3y)10.41%
ROIC(5y)8.01%
ROICexc(3y)13.8%
ROICexc(5y)10.4%
ROICexgc(3y)16.47%
ROICexgc(5y)12.05%
ROCE(3y)14.77%
ROCE(5y)11.36%
ROICexcg growth 3Y243.61%
ROICexcg growth 5Y-11.61%
ROICexc growth 3Y232.06%
ROICexc growth 5Y-13.01%
OM growth 3Y212.88%
OM growth 5Y-3.77%
PM growth 3YN/A
PM growth 5Y-13.02%
GM growth 3Y8%
GM growth 5Y0.86%
F-Score8
Asset Turnover1.53
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 84.58% | ||
| Cap/Sales | 3.59% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 71.27% | ||
| Profit Quality | 112.36% | ||
| Current Ratio | 1.57 | ||
| Quick Ratio | 0.74 | ||
| Altman-Z | 4.08 |
F-Score8
WACC10.27%
ROIC/WACC1.08
Cap/Depr(3y)113.61%
Cap/Depr(5y)107.11%
Cap/Sales(3y)4.51%
Cap/Sales(5y)4.37%
Profit Quality(3y)121.04%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)51.24%
EPS 3YN/A
EPS 5Y0.53%
EPS Q2Q%56%
EPS Next Y12.08%
EPS Next 2Y10.01%
EPS Next 3Y10.66%
EPS Next 5YN/A
Revenue 1Y (TTM)7.9%
Revenue growth 3Y11.86%
Revenue growth 5Y5.45%
Sales Q2Q%7.51%
Revenue Next Year1.51%
Revenue Next 2Y2.42%
Revenue Next 3Y3.01%
Revenue Next 5YN/A
EBIT growth 1Y34.48%
EBIT growth 3Y249.99%
EBIT growth 5Y1.47%
EBIT Next Year78.94%
EBIT Next 3Y26.66%
EBIT Next 5YN/A
FCF growth 1Y240.75%
FCF growth 3Y74.83%
FCF growth 5Y8.06%
OCF growth 1Y518.24%
OCF growth 3Y42.07%
OCF growth 5Y4.93%