By analyzing existing technical and fundamental indicators between American Eagle and Carters, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Carters with a short position in American Eagle. Check out our
pair correlation module for more information.
Let's begin by analyzing the assets.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. American Eagle has an asset utilization ratio of 310.75 percent. This suggests that the company is making $3.11 for each dollar of assets. An increasing asset utilization means that American Eagle Outfitters is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two entities, such as American or Urban is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.
understanding American Eagle dividends
A dividend is the distribution of a portion of American Eagle earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. American Eagle dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. American one year expected dividend income is about USD0.2 per share.
At this time, American Eagle's
Dividend Yield is very stable compared to the past year. As of the 19th of April 2024,
Dividend Payout Ratio is likely to grow to 1.21, though
Dividends Paid is likely to grow to (79.6
M).
Investing in stocks that pay
dividends, such as stock of American Eagle Outfitters, is one of many strategies that are good for long-term investments. Ex-dividend dates are significant because investors in American Eagle must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for American Eagle. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.
How important is American Eagle's Liquidity
American Eagle
financial leverage refers to using borrowed capital as a funding source to finance American Eagle Outfitters ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. American Eagle financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to American Eagle's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of American Eagle's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the
breakdown between American Eagle's total debt and its cash.
Correlation Between American and Urban Outfitters
In general, Stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding American Eagle together with similar or unrelated positions with a negative correlation. For example, you can also add Urban Outfitters to your portfolio. If Urban Outfitters is not perfectly correlated to American Eagle it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When American Eagle, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down.
Are you currently holding both American Eagle and Urban Outfitters in your portfolio? Please note if you are using this as a pair-trade strategy between American Eagle and Urban Outfitters, watch out for correlation discrepancy over time. Relying on the historical price correlations and assuming that it will not change may lead to short-term losses. Please check
pair correlation details between AEO and URBN for more information.
What is driving American Eagle Investor Appetite?
Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.
Revenue Breakdown
Let me now analyze American Eagle revenue. Based on the latest financial disclosure, American Eagle Outfitters reported 5.01
B of revenue. This is 29.73% lower than that of the Consumer Cyclical sector and significantly higher than that of the
Apparel Retail industry. The revenue for all United States stocks is 46.9% higher than that of American Eagle Outfitters. As for Carters we see revenue of 3.48
B, which is much higher than that of the Apparel Retail
| American | 5.01 Billion |
| Sector | 0.0 |
| Carters | 3.48 Billion |
How will American institutional investors react to the next slide?
Latest market risk adjusted performance indicator falls down to -0.39. Possible price upswing? American Eagle Outfitters exhibits very low volatility with skewness of 0.22 and kurtosis of 0.6. However, we advise investors to further study American Eagle Outfitters technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure American Eagle's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact American Eagle's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.
American Eagle Implied Volatility
American Eagle's implied volatility exposes the market's sentiment of American Eagle Outfitters stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if American Eagle's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that American Eagle stock will not fluctuate a lot when American Eagle's options are near their expiration.
Our Takeaway on American Eagle Investment
Whereas many other companies in the apparel retail industry are either recovering or due for a correction, American Eagle may not be performing as strong as the other in terms of long-term growth potentials. In closing, as of the 14th of June 2022, our research shows that American Eagle is a rather not too volatile investment opportunity with a
low probability of distress in the next two years. From a slightly different view, the entity currently appears to be
undervalued. Our current 90 days recommendation on the company is
Strong Hold.
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Vlad Skutelnik is a Macroaxis Contributor. Vlad covers stocks, funds, cryptocurrencies, and ETFs that are traded in North America, focusing primarily on fundamentals, valuation and market volatility. He has many years of experience in fintech, predictive investment analytics, and risk management.
View Profile This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of American Eagle Outfitters. Please refer to our
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