Why American Eagle Outfitters Stock Jumped 5% Today
Shares of American Eagle Outfitters (NYSE: AEO) gained roughly 5% in the first half of trading on Thursday, and was up by 4.5% as of 2:13 p.m. EST. The driving force behind that rise was a pair of company news releases and a presentation about management's plans. If all goes according to expectations, the future could be bright for this fashion retailer.
American Eagle Outfitters has decided to start breaking out the results of its Aerie nameplate. That was a pretty important decision, and the fourth quarter shows why. According to the update management provided, American Eagle expects Q4 adjusted operating income to be around $95 million, up from just $77 million in the prior-year quarter, Lower advertising costs and higher selling prices helped that along.
The bulk of the positives here, however, came from Aerie, where sales rose in the high-20% range, and its e-commerce channels, which should show double-digit percentage growth across both of the company's nameplates. But, notably, the company expects to report a sales decline in the low-double-digit percentage range for its namesake American Eagle stores. So investors can anticipate something of a mixed bag when the retailer delivers the final report on March 3.
Source Fool.com
