Young adult apparel retailer American Eagle Outfitters (NYSE: AEO) will be reporting results this Wednesday afternoon. Here’s what to expect.
American Eagle met analysts’ revenue expectations last quarter, reporting revenues of $1.09 billion, down 4.7% year on year. It was a softer quarter for the company, with a significant miss of analysts’ EBITDA and EPS estimates.
Is American Eagle a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting American Eagle’s revenue to decline 4.4% year on year to $1.23 billion, a reversal from the 7.5% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.20 per share.
Heading into earnings, analysts covering the company have grown increasingly bullish with revenue estimates seeing 6 upward revisions over the last 30 days (we track 8 analysts). American Eagle has missed Wall Street’s revenue estimates five times over the last two years.
Looking at American Eagle’s peers in the apparel retailer segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Victoria's Secret delivered year-on-year revenue growth of 3%, beating analysts’ expectations by 4%, and Urban Outfitters reported revenues up 11.3%, topping estimates by 1.9%. Victoria's Secret traded up 1.1% following the results while Urban Outfitters was down 10.8%.
Read our full analysis of Victoria's Secret’s results here and Urban Outfitters’s results here.
There has been positive sentiment among investors in the apparel retailer segment, with share prices up 6.8% on average over the last month. American Eagle is down 2.6% during the same time and is heading into earnings with an average analyst price target of $11.56 (compared to the current share price of $12.94).
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