Stock Traders Buy High Volume of Call Options on American Eagle Outfitters (NYSE:AEO)

Key Points

• American Eagle Outfitters experienced a significant increase in call options trading, with 27,403 contracts purchased, a rise of approximately 48% from the usual volume.
• Several analysts have lowered their target prices for the company, with BMO Capital Markets cutting it from $15.00 to $11.00 and Barclays from $10.00 to $9.00, reflecting decreasing confidence in the stock.
• The company reported a net loss of ($0.29) per share in the last quarter, missing analysts' estimates, with a revenue of $1.09 billion, marking a 4.7% decrease year-over-year.

American Eagle Outfitters, Inc. (NYSE:AEO - Get Free Report) was the target of some unusual options trading on Thursday. Investors purchased 27,403 call options on the stock. Thisrepresentsanincreaseofapproximately48% compared to the average daily volume of 18,473 call options.

American Eagle Outfitters Stock Down 0.9%

American Eagle Outfitters stock traded down $0.12 during trading hours on Monday, reaching $12.87. The stock had a trading volume of 10,599,615 shares, compared to its average volume of 19,179,880. The company has a market cap of $2.23 billion, a price-to-earnings ratio of 13.13 and a beta of 1.51. The business's 50 day moving average price is $10.77 and its 200-day moving average price is $11.54. American Eagle Outfitters has a 52 week low of $9.27 and a 52 week high of $22.83. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.38 and a quick ratio of 0.56.

American Eagle Outfitters (NYSE:AEO - Get Free Report) last posted its quarterly earnings data on Thursday, May 29th. The apparel retailer reported ($0.29) EPS for the quarter, missing the consensus estimate of ($0.25) by ($0.04). American Eagle Outfitters had a return on equity of 13.34% and a net margin of 3.73%. The firm had revenue of $1.09 billion for the quarter, compared to the consensus estimate of $1.08 billion. During the same quarter last year, the firm earned $0.34 EPS. The company's revenue was down 4.7% compared to the same quarter last year. Sell-side analysts anticipate that American Eagle Outfitters will post 1.7 EPS for the current year.

American Eagle Outfitters Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Friday, July 25th. Stockholders of record on Friday, July 11th were given a $0.125 dividend. The ex-dividend date of this dividend was Friday, July 11th. This represents a $0.50 dividend on an annualized basis and a dividend yield of 3.9%. American Eagle Outfitters's dividend payout ratio (DPR) is presently 51.02%.

Wall Street Analyst Weigh In

A number of analysts have weighed in on the company. Wall Street Zen lowered American Eagle Outfitters from a "hold" rating to a "sell" rating in a research note on Saturday, June 7th. Cfra Research downgraded shares of American Eagle Outfitters from a "moderate buy" rating to a "hold" rating in a research note on Friday, June 6th. JPMorgan Chase & Co. reiterated an "underweight" rating and set a $9.00 price objective on shares of American Eagle Outfitters in a report on Monday, July 28th. Morgan Stanley set a $10.00 price objective on shares of American Eagle Outfitters and gave the company an "equal weight" rating in a research report on Monday, June 2nd. Finally, Zacks Research raised shares of American Eagle Outfitters to a "hold" rating in a research report on Monday, August 11th. Three analysts have rated the stock with a sell rating, ten have assigned a hold rating and one has given a buy rating to the stock. According to data from MarketBeat, the stock has an average rating of "Hold" and a consensus price target of $14.70.

Institutional Trading of American Eagle Outfitters

A number of institutional investors have recently made changes to their positions in the business. Wealth Enhancement Advisory Services LLC grew its position in American Eagle Outfitters by 319.2% during the 1st quarter. Wealth Enhancement Advisory Services LLC now owns 44,570 shares of the apparel retailer's stock worth $518,000 after purchasing an additional 33,938 shares during the last quarter. GAMMA Investing LLC lifted its stake in shares of American Eagle Outfitters by 380.4% during the first quarter. GAMMA Investing LLC now owns 2,325 shares of the apparel retailer's stock worth $27,000 after buying an additional 1,841 shares during the period. Rhumbline Advisers lifted its stake in shares of American Eagle Outfitters by 0.7% during the first quarter. Rhumbline Advisers now owns 528,510 shares of the apparel retailer's stock worth $6,141,000 after buying an additional 3,631 shares during the period. Janney Montgomery Scott LLC purchased a new stake in shares of American Eagle Outfitters during the first quarter valued at $440,000. Finally, Asset Management One Co. Ltd. increased its position in shares of American Eagle Outfitters by 38.7% in the 1st quarter. Asset Management One Co. Ltd. now owns 4,173 shares of the apparel retailer's stock valued at $48,000 after acquiring an additional 1,165 shares during the period. Institutional investors and hedge funds own 97.33% of the company's stock.

About American Eagle Outfitters

American Eagle Outfitters, Inc operates as a multi-brand specialty retailer in the United States and internationally. The company provides jeans, apparel and accessories, and personal care products for women and men under the American Eagle brand; and intimates, apparel, activewear, and swim collections under the Aerie and OFFLINE by Aerie brands.