Why American Eagle Outfitters Stock Rose as Much as 13% This Week
Shares of teen fashion retailer American Eagle Outfitters (NYSE: AEO) hit a high-water mark just shy of 13% this week according to data from S&P Global Market Intelligence. At the start of trading on Friday Nov. 5, meanwhile, the stock was still higher by roughly 11.5%. Although it's earnings season, the company doesn't report until Nov. 23, so the move didn't have anything to do with the retailer's earnings at all. It was likely attributable to an acquisition.
There's a couple of unique things here. First, very often, when a company announces it is buying another company the acquirer's shares go down. That makes logical sense, given that the buyer has to come up with the cash to pay for the purchase and there's usually a premium involved. But instead, the stock went up. Second, American Eagle isn't buying another retail brand, which is what you might expect. It's buying a logistics company.
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Source Fool.com
