Over the past week, American Eagle Outfitters Inc's (AEO, Financial) stock has seen a gain of 5.67%, and over the past three months, the stock has surged by an impressive 42.23%. Currently priced at $17.73, the company boasts a market cap of $3.5 billion. According to the GF Value, a measure defined by GuruFocus.com that calculates a stock's intrinsic value using historical multiples, past performance adjustments, and future business estimates, the stock is currently fairly valued at $16.93. However, three months ago, the stock was significantly undervalued with a GF Value of $17.02.
Introducing American Eagle Outfitters Inc
American Eagle Outfitters Inc is a retail - cyclical company that operates in two segments: American Eagle and Aerie. The company is an apparel and accessory retailer with company stores in the U.S., Canada, Mexico, and Hong Kong. It also has an online business that ships worldwide. The majority of its revenue comes from its primary brand, American Eagle, which offers an assortment of specialty apparel and accessories for women and men. The vast majority of its revenue is generated from the United States. 
Profitability Analysis
With a Profitability Rank of 7/10, American Eagle Outfitters Inc demonstrates strong profitability. The company's operating margin of 6.43% is better than 65.32% of companies in the industry. Its ROE (Return on Equity) of 13.13% and ROA (Return on Assets) of 5.79% are better than 70.62% and 70.68% of companies respectively. The company's ROIC (Return on Invested Capital) of 7.53% is better than 66.93% of companies. Over the past 10 years, the company has been profitable for 9 years, which is better than 71.02% of companies. 
Growth Prospects
Despite its strong profitability, American Eagle Outfitters Inc has a low Growth Rank of 2/10. The company's 3-year and 5-year revenue growth rates per share are -1.20% and 2.30% respectively. However, the company's future 3-year to 5-year total revenue growth rate estimate is 3.66%, which is better than 38.17% of companies. The company's 3-year EPS without NRI growth rate is -17.00%. 
Top Holders of the Stock
The top three holders of American Eagle Outfitters Inc's stock are Ken Fisher (Trades, Portfolio), who holds 1.11% of the shares, Lee Ainslie (Trades, Portfolio), who holds 0.15% of the shares, and Jeremy Grantham (Trades, Portfolio), who holds 0.12% of the shares.
Competitive Landscape
American Eagle Outfitters Inc's main competitors in the retail - cyclical industry are Urban Outfitters Inc (URBN, Financial) with a market cap of $3.02 billion, Abercrombie & Fitch Co (ANF, Financial) with a market cap of $3.16 billion, and Carter's Inc (CRI, Financial) with a market cap of $2.47 billion.
Conclusion
In conclusion, American Eagle Outfitters Inc's stock has performed impressively over the past three months, with a significant surge of 42.23%. The company's strong profitability, as indicated by its profitability rank of 7/10 and its operating margin, ROE, ROA, and ROIC, sets it apart from the majority of companies in the industry. However, its growth prospects are relatively low, with a growth rank of 2/10. Despite this, the company's future 3-year to 5-year total revenue growth rate estimate is promising. In comparison to its main competitors, the company holds a strong position in the market. Based on the analyzed data, the potential future performance of the stock appears promising.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
