American Eagle Outfitters Posts Better-Than-Expected Q1 Results; Street Says Buy

American Eagle Outfitters (AEO), a global specialty retailer, posted strong fiscal Q1 results, driven by a rise in demand for Aerie products.

The company recorded Q1 adjusted earnings of $0.48 per share, topping analysts’ expectations of $0.46. Revenues came in at $1.03 billion, which outpaced the Street’s estimates of $1.02 billion.

Aerie revenue came in at $297.5 million, up 92% year-over-year, while American Eagle revenue grew 86.4% to $727.7 million. (See American Eagle Outfitters stock analysis on TipRanks)

American Eagle Outfitters CEO Jay Schottenstein said, “We have been well positioned to meet higher demand for our products and have exceled in managing all facets of our business. We remain poised for success, and our brands are stronger than ever. I believe we are on pace to deliver our 2023 operating profit target well ahead of schedule.”

Following the Q1 results, Deutsche Bank analyst Gabriella Carbone lifted the stock’s price target to $43 (22.3% upside potential) from $41 and maintained a Buy rating.

According to Carbone, the company reported strong Q1 results and is likely to record significant earnings growth, driven by its sales target of $2 billion by 2023.

American Eagle Outfitters shares have skyrocketed 241.5% over the past year, while the stock still scores a Strong Buy consensus rating, based on 11 Buys versus 3 Holds. That’s alongside an average analyst price target of $39.50, which implies over 12% upside potential to current levels.

Additionally, American Eagle Outfitters scores an 8 of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.

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