American Eagle Outfitters, Inc. (NYSE: AEO) shared in a press release today that its fourth quarter-to-date revenue, through Saturday, December 30, 2023, has surged by approximately 8%. American Eagle's sales are tracking up in the high single digits while Aerie's sales are up in the low teens. As a result, the company is revising its fourth quarter outlook for revenue to be up low double digits, with an expected operating profit of approximately $130 million, up from the previous guidance of $105 to $115 million. The improved outlook is attributed to record holiday sales and strong merchandise margins.
Jay Schottenstein, AEO's Executive Chairman of the Board and Chief Executive Officer, expressed his satisfaction with the company's performance during the holiday season, stating, "This holiday season we executed with confidence and precision, delivering winning product assortments and an exciting customer experience which showcased the strength of our brands and operations." Looking ahead, Schottenstein remains confident in the company's ability to deliver healthy earnings growth and operating rate improvement for 2024.
The stock's movement today, up 1.0%, reflects the positive market sentiment following this announcement, with shares now trading at $21.48 per share.
In a statement about the company's outlook, Jay Schottenstein remarked, "Looking ahead to 2024, we remain confident in our ability to deliver healthy earnings growth and operating rate improvement as we maintain inventory and promotional discipline, prioritize expense control and benefit from ongoing work on our profit improvement initiative."
American Eagle Outfitters, Inc. is a leading global specialty retailer offering high-quality, on-trend clothing, accessories, and personal care products at affordable prices under its American Eagle® and Aerie® brands. The company operates stores in the United States, Canada, Mexico, Hong Kong, and Japan, and ships to approximately 80 countries worldwide through its websites. American Eagle and Aerie merchandise is also available at more than 300 international locations operated by licensees in approximately 30 countries.
The full 8-K submission from American Eagle Outfitters, Inc. is available here.
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (MM) | $3,796 | $4,036 | $4,308 | $3,759 | $5,011 | $4,990 |
| Revenue Growth | n/a | 6.33% | 6.75% | -12.75% | 33.3% | -0.42% |
| Operating Margins | 8% | 8% | 5% | -7% | 12% | 5% |
| Net Margins | 5% | 6% | 4% | -6% | 3% | 3% |
| Net Income (MM) | $204 | $262 | $191 | -$209 | $152 | $125 |
| Net Interest Expense (MM) | -$16 | $4 | $6 | $4 | $2 | $14 |
| Depreciation & Amort. (MM) | $167 | $168 | $179 | $162 | $167 | $212 |
| Earnings Per Share | $1.13 | $1.47 | $1.12 | -$1.26 | $2.03 | $181778.0 |
| EPS Growth | n/a | 30.09% | -23.81% | -212.5% | 261.11% | 8954481.28% |
| Diluted Shares (MM) | 178 | 169 | 184 | 205 | 196 | 198 |
| Free Cash Flow (MM) | $225 | $268 | $205 | $75 | -$177 | $146 |
| Capital Expenditures (MM) | $169 | $189 | $210 | $128 | $203 | $260 |
| Current Ratio | 1.85 | 1.33 | 1.69 | 2.04 | 1.86 | 1.63 |
American Eagle Outfitters has growing revenues and increasing reinvestment in the business, exceptional EPS growth, and healthy leverage. However, the firm has irregular cash flows. Finally, we note that American Eagle Outfitters has average net margins with a negative growth trend.
