American Eagle Stays Aloft

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American Eagle Outfitters (Nasdaq: AEOS), a Motley Fool Stock Advisor recommendation, had a sizzling November. In stores operating for at least one year, same-store sales grew by 14%. But that wasn't enough for Wall Street, and the stock price fell 3.77% to $45.18.

The same-store sales metric has become a bit of a quick-hit traders game. Missing the consensus estimate can create a sharp move on a company's stock. In American Eagle's case, the Thomson Financial estimate called for same-store sales growth of 14.8%. But for investors whose horizon extends beyond the next few hours, this volatility can be an opportunity.

American Eagle is resonating with a tough-to-reach demographic -- shoppers between the ages of 15 and 25. Other retailers in this category, including Abercrombie & Fitch (NYSE: ANF), have proven that this can be a lucrative market. True, the growth will eventually slow down as teens' tastes migrate elsewhere. But that may be a while off for American Eage, which appears to still be early in its growth cycle.

Besides, the strong same-store sales growth should be helpful in boosting profits. After all, expenses tend to act more like fixed costs in the retail game. So long as American Eagle's sales momentum continues, the fourth quarter could contain an earnings surprise.

Shop around for further Foolishness:

• Eagle Soars Higher
• American Eagle on a Pogo Stick: Fool by Numbers
• September's Teen Scene

Discover more Foolishly fashionable stock selections from Tom and David Gardner with a free 30-day trial to Motley Fool Stock Advisor.

Fool contributor Tom Taulli does not own shares of companies mentioned in this article. He is currently ranked 380 out of 14,555 in CAPS.