American Eagle Outfitters, headquartered in Pittsburgh, employs 10,300 staff and sells apparel and accessories through its American Eagle and Aerie brands in stores across the U.S., Canada, and beyond. The company also operates Todd Snyder New York and has licensing agreements for its brands in various international markets.
Based on our analysis, American Eagle Outfitters (AEO) has received an undervalued rating of 4 out of 5 stars from Cashu, primarily due to its strong financial performance compared to industry averages.
The company's Price-to-Earnings (PE) ratio stands at 10.34, significantly lower than the sector average of 15.61. A lower PE ratio can indicate that the stock is undervalued, suggesting investors may be paying less for each dollar of earnings compared to its peers. Similarly, AEO's Price-to-Book (PB) ratio of 1.69 is below the sector average of 1.97, further indicating that the market may undervalue the company relative to its assets.
AEO also boasts a robust net profit margin of 6.18%, vastly superior to the sector’s average of just 0.09%. This means that American Eagle is more efficient at converting revenue into actual profit, which is a positive sign for potential investors. Moreover, the company’s return on equity (ROE) is an impressive 18.64%, compared to the sector average of 1.09%. A high ROE indicates effective management and a strong ability to generate returns from shareholder equity.
Additionally, AEO offers a dividend yield of 4.60%, significantly higher than the sector average of 2.56%, which may appeal to income-focused investors. Lastly, the company’s return on assets (ROA) of 8.60% outshines the sector's negative -0.10%, highlighting efficient use of its assets to generate earnings.
This is not a comprehensive overview of our valuation, and should not be viewed as financial advice. Always do your own research before considering an investment.
📡️ Consumer Discretionary
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