Yahoo Finance What Makes American Eagle Outfitters Inc (NYSE:AEO) An Attractive Investment?
Attractive stocks have exceptional fundamentals. In the case of American Eagle Outfitters Inc (NYSE:AEO), there’s is a financially-robust , dividend-paying company with a an impressive history of performance. Below, I’ve touched on some key aspects you should know on a high level. If you’re interested in understanding beyond my high-level commentary, take a look at the report on American Eagle Outfitters here.
Outstanding track record with flawless balance sheet and pays a dividend
AEO delivered a bottom-line expansion of 46.5% in the prior year, with its most recent earnings level surpassing its average level over the last five years. The strong earnings growth is reflected in impressive double-digit 20.5% return to shareholders, which paints a buoyant picture for the company. AEO’s strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This implies that AEO manages its cash and cost levels well, which is a crucial insight into the health of the company. Looking at AEO’s capital structure, the company has no debt on its balance sheet. It has only utilized funding from its equity capital to run the business, which is rather impressive for a US$4.35b market cap company. Investors’ risk associated with debt is virtually non-existent and the company has plenty of headroom to grow debt in the future, should the need arise.
AEO is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
Next Steps:
For American Eagle Outfitters, there are three relevant aspects you should further examine:
Future Outlook: What are well-informed industry analysts predicting for AEO’s future growth? Take a look at our free research report of analyst consensus for AEO’s outlook.
Valuation: What is AEO worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether AEO is currently mispriced by the market.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of AEO? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
