Investors Purchase Large Volume of American Eagle Outfitters Call Options (NYSE:AEO)

Key Points

• Unusual options activity: Investors purchased 17,034 American Eagle Outfitters call options, about 123% above the typical volume of 7,648 contracts.
• Analysts remain cautious: AEO has an average “Hold” rating and a consensus price target of $20.09, with 12 analysts rating it Hold, two Buy, and one Sell.
• Recent performance and finances: Shares rose to $17.68, while the company exceeded quarterly earnings and revenue expectations. American Eagle also pays a quarterly dividend of $0.125, representing a 2.8% yield.

American Eagle Outfitters, Inc. (NYSE:AEO - Get Free Report) saw some unusual options trading on Wednesday. Investors acquired 17,034 call options on the stock. This represents an increase of approximately 123% compared to the typical volume of 7,648 call options.

Analyst Ratings Changes

Several research firms recently weighed in on AEO. TD Cowen decreased their target price on shares of American Eagle Outfitters from $19.00 to $18.00 and set a "hold" rating for the company in a research note on Monday, May 18th. Wall Street Zen lowered shares of American Eagle Outfitters from a "buy" rating to a "hold" rating in a research report on Saturday, August 15th. Morgan Stanley reiterated an "equal weight" rating and issued a $18.00 price target on shares of American Eagle Outfitters in a research note on Monday, July 6th. JPMorgan Chase & Co. lifted their price objective on shares of American Eagle Outfitters from $19.00 to $21.00 and gave the company a "neutral" rating in a research report on Tuesday, August 18th. Finally, The Goldman Sachs Group set a $22.00 price objective on shares of American Eagle Outfitters in a research note on Monday, June 1st. Two investment analysts have rated the stock with a Buy rating, twelve have issued a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat.com, American Eagle Outfitters currently has an average rating of "Hold" and an average target price of $20.09.

American Eagle Outfitters Stock Performance

Shares of AEO stock traded up $0.95 during trading on Wednesday, reaching $17.68. 4,214,875 shares of the company's stock were exchanged, compared to its average volume of 5,289,792. American Eagle Outfitters has a twelve month low of $12.50 and a twelve month high of $28.46. The firm's fifty day moving average price is $17.16 and its 200-day moving average price is $18.20. The company has a quick ratio of 0.53, a current ratio of 1.55 and a debt-to-equity ratio of 0.05. The stock has a market capitalization of $2.96 billion, a PE ratio of 10.91, a PEG ratio of 3.68 and a beta of 1.32.

American Eagle Outfitters (NYSE:AEO - Get Free Report) last released its quarterly earnings data on Thursday, May 28th. The apparel retailer reported $0.14 EPS for the quarter, topping analysts' consensus estimates of $0.11 by $0.03. The firm had revenue of $1.20 billion during the quarter, compared to analysts' expectations of $1.18 billion. American Eagle Outfitters had a net margin of 5.01% and a return on equity of 20.95%. The company's revenue for the quarter was up 9.7% compared to the same quarter last year. During the same period in the previous year, the business posted ($0.29) earnings per share. As a group, sell-side analysts anticipate that American Eagle Outfitters will post 1.76 EPS for the current year.

American Eagle Outfitters Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Friday, July 24th. Shareholders of record on Friday, July 10th were issued a $0.125 dividend. This represents a $0.50 annualized dividend and a yield of 2.8%. The ex-dividend date of this dividend was Friday, July 10th. American Eagle Outfitters's dividend payout ratio (DPR) is currently 30.86%.

Insider Activity

In related news, Director Noel Joseph Spiegel sold 2,892 shares of the company's stock in a transaction dated Tuesday, July 7th. The stock was sold at an average price of $16.78, for a total transaction of $48,527.76. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, Director Cary D. Mcmillan sold 2,892 shares of the stock in a transaction that occurred on Tuesday, July 7th. The shares were sold at an average price of $16.77, for a total value of $48,498.84. The disclosure for this sale is available in the SEC filing. Insiders sold 11,563 shares of company stock worth $196,599 in the last quarter. Corporate insiders own 8.95% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors have recently added to or reduced their stakes in the company. Plato Investment Management Ltd bought a new stake in shares of American Eagle Outfitters during the 2nd quarter worth $25,000. Kemnay Advisory Services Inc. acquired a new position in American Eagle Outfitters during the fourth quarter worth about $31,000. Aster Capital Management DIFC Ltd bought a new position in shares of American Eagle Outfitters in the fourth quarter worth about $32,000. Raymond James Financial Inc. bought a new position in shares of American Eagle Outfitters in the second quarter worth about $35,000. Finally, Allworth Financial LP acquired a new stake in shares of American Eagle Outfitters in the 2nd quarter valued at approximately $36,000. 97.33% of the stock is currently owned by institutional investors and hedge funds.

American Eagle Outfitters Company Profile

American Eagle Outfitters, Inc NYSE: AEO is a leading American specialty retailer offering apparel, accessories and personal care products for men and women. The company's flagship brand, American Eagle, focuses on casualwear including denim, tops, outerwear and accessories targeted primarily at teens and young adults. In addition to its core apparel lines, the company operates the Aerie brand of intimates, loungewear and swimwear, which has gained recognition for its body-positive marketing and inclusive sizing.

American Eagle Outfitters conducts business through a combination of over 900 brick-and-mortar stores in North America and Greater China, complemented by a growing e-commerce platform that serves customers around the globe.

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