Everything you need to know before you earn

Young adult clothing retailer American Eagle Outfitters (NYSE:AEO) will report earnings tomorrow after the market closes. Here’s what investors need to know.

American Eagle met analysts’ revenue expectations last quarter, reporting revenue of $1.68 billion, up 12.2% year-over-year. It was a good quarter for the company, after solidly beating analyst earnings estimates. Looking ahead, management expects revenue growth of 3% for full-year 2024, which is off analyst estimates. However, projected full-year operating income of $455 million easily met analyst expectations of $362 million.

Does the purchase or sale of American Eagle affect earnings? Read our full analysis here, it’s free.

Analysts expect American Eagle’s revenue this quarter to grow 6.5% year-over-year to $1.15 billion, an improvement from the 2.5% growth reported in the same quarter last year. Adjusted earnings are expected to be $0.28 per share.

Analysts covering the company have broadly reaffirmed their estimates over the last 30 days, suggesting they expect the company to continue its course towards earnings. Over the past two years, American Eagle has missed Wall Street revenue estimates only once, which has been in line with earnings expectations on average.

Looking at American Eagle’s competitors in the apparel and footwear retail segment, some of them have already released first-quarter results, which gives us a hint of what to expect. Urban Outfitters reported revenue growth of 7.8% year-over-year, beating analyst expectations by 1.8%, and Shoe Carnival reported revenue growth of 6.8%, beating estimates by 2%. Following the results, shares of Urban Outfitters fell 4.5%, while Shoe Carnival rose 7.9%.

Read our full analysis of Urban Outfitters’ results here and Shoe Carnival’s results here.

Investors in the retail apparel and footwear segment are enjoying positive sentiment, with share prices up an average of 6.7% over the past month. Meanwhile, American Eagle is down 6.4% and heading toward earnings, with an average analyst price target of $26.1 (versus the current share price of $23.25).

Today’s young investors probably haven’t read the timeless lessons of Gorilla Game: Picking Winners In High Technology because it was written over 20 years ago, when Microsoft and Apple were first asserting their dominance. However, if we apply the same principles, enterprise software that leverages its own generative AI capabilities could be the gorillas of the future. In that spirit, we’re excited to present our free special report on profitable, fast-growing enterprise software that’s already riding the automation wave and looking to leverage generative AI next.