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American Eagle (AEO) Q3 Earnings: What To Expect

AEO Cover Image

Young adult apparel retailer American Eagle Outfitters (NYSE:AEO) will be reporting earnings tomorrow after market hours. Here’s what to expect.

American Eagle missed analysts’ revenue expectations by 1.4% last quarter, reporting revenues of $1.29 billion, up 7.5% year on year. It was a slower quarter for the company, with a miss of analysts’ EBITDA estimates and gross margin in line with analysts’ 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 be flat year on year at $1.30 billion, slowing from the 4.9% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.46 per share.

American Eagle Total Revenue

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. American Eagle has missed Wall Street’s revenue estimates twice over the last two years.

Looking at American Eagle’s peers in the apparel retailer segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Urban Outfitters delivered year-on-year revenue growth of 6.3%, beating analysts’ expectations by 1.8%, and Gap reported revenues up 1.6%, topping estimates by 0.6%. Urban Outfitters traded up 18.2% following the results while Gap was also up 12.7%.

Read our full analysis of Urban Outfitters’s results here and Gap’s results here.

There has been positive sentiment among investors in the apparel retailer segment, with share prices up 9.9% on average over the last month. American Eagle is up 4.4% during the same time and is heading into earnings with an average analyst price target of $23.50 (compared to the current share price of $19.98).

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