Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



American Eagle Shares Jumped: What You Need to Know

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of teen retailer American Eagle Outfitters (NYSE: AEO  ) were looking quite trendy to investors in early trading, as they rose as much as 11%. The excitement faded quickly, though, shares finished the day up 3.5%, which was behind the Dow's 3.8% jump.

So what: It's been a tough slog for retailers as consumers continue to muddle through deleveraging their balance sheets and dealing with high unemployment. American Eagle, though, showed a bright spot on the top line in its third quarter by growing total sales 11% to $832 million and easily exceeding the $791 million expectation from Wall Street analysts. Comparable-store sales rose 5% after gaining just 1% for the same period in 2010.

The bottom line wasn't quite as exciting, but the $0.27 in earnings per share matched expectations. It was, however, down from the adjusted $0.29 earned a year ago.

Now what: When it comes to earnings releases, investors are often less concerned about what the company earned last quarter and more concerned about what it will earn next quarter. On that point, American Eagle's guidance was worth cheering. The company said:

"Strong sales over Thanksgiving weekend were driven by increased traffic and conversion. Powerful unit sales growth reflected a positive customer response to the holiday assortment and planned promotions."

The strong Thanksgiving weekend encouraged management to set its fourth-quarter per-share profit guidance at a range of $0.40 and $0.44, easily above the $0.39 that Wall Street had on its radar.

Want to keep up to date on American Eagle Outfitters? Add it to your watchlist.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Matt Koppenheffer has no financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter, @KoppTheFool, or on Facebook. The Fool’s disclosure policy prefers dividends over a sharp stick in the eye.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1734141, ~/Articles/ArticleHandler.aspx, 10/28/2016 6:15:33 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 8 hours ago Sponsored by:
DOW 18,169.68 -29.65 -0.16%
S&P 500 2,133.04 -6.39 -0.30%
NASD 5,215.97 -34.29 -0.65%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/27/2016 4:02 PM
AEO $16.93 Down -0.14 -0.82%
American Eagle Out… CAPS Rating: ****