Long Position on AEO @ $17.50 on 10/27/2023 (Momentum)

American Eagle Outfitters, Inc. (AEO) operates as a specialty retailer that provides clothing, accessories, and personal care products under the American Eagle and Aerie brands in the United States and internationally. 

The company provides jeans, apparel and accessories, and personal care products for women and men; and intimates, apparel, activewear, and swim collections.

It also offers menswear products under the Todd Snyder New York brand; and fashion clothing and accessories under the Unsubscribed brand.

The company sells its products through retail stores; digital channels, such as www.ae.com, www.aerie.com, www.toddsnyder.com, and www.unsubscribed.com; and applications.

Shares have formed a bullish "cup and handle" following its lastest earnings report. On September 6th, AEO reported earnings of $0.25 per share on revenue of $1.20 billion for the fiscal second quarter ended July 2023. The consensus earnings estimate was $0.15 per share on revenue of $1.19 billion. The company beat expectations by 31.58% while revenue grew 0.23% on a year-over-year basis.

Guided Higher: The company said it expects third quarter revenue of approximately $1.27 billion and now expects fiscal year revenue of approximately $5.11 billion. The company's previous guidance was revenue of $4.87 billion to $4.99 billion. The current consensus revenue estimate is $1.23 billion for the quarter ending October 31, 2023 and revenue of $4.99 billion for the year ending January 31, 2024. 

Entry Point: $17.50

Stop Loss: $16.50

Trading Range: $9.95 to 18.41

Target Price: $19.25

Position closed on 11/8/2023 at price of $18.50 with a 5.71% gain in 11 days.

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