AEO

American Eagle Outfitters, Inc.

13.43
USD
-0.37%
13.43
USD
-0.37%
13.05 38.99
52 weeks
52 weeks

Mkt Cap 2.26B

Shares Out 168.60M

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American Eagle, Bath & Body Works and Skechers are screaming buys at UBS

UBS analyst Jay Sole singles out three softlines retail stocks as being the most misunderstood by the market. American Eagle Outfitters (NYSE:AEO) with a price target repping 97% upside: "AEO is a fast-growing, multichannel, branded apparel company. The market views it as a traditional, mall-based, teen retailer likely to shrink as shopping shifts online. The market is overlooking AEO's Aerie brand, which has delivered 28 consecutive quarters of +DD% sales growth... if AEO can reach its $1B FY23 operating income bull case, the stock is likely trading at just 6x FY23 EPS today." Bath & Body Works (NYSE:BBWI) with a price target repping 74% upside: "It has #1 US market share in categories such as Liquid Hand Soap, Body Lotion, and Candles as well as a mid-to-high 20% EBIT margin. Its dominance stems from major advantages in three areas: 1) product value-for-money; 2) more frequent and better product innovation; and 3) supply chain speed. We see it maintaining a mid-to-high-single digit sales CAGR through FY25... We think BBWI has added to its customer base during the pandemic and any reversal will be mild." Skechers U.S.A. (NYSE:SKX) with a price target repping 48% upside: "We view SKX as a growth stock, with +DD% annual sales growth potential, including 2022... What is relevant, in our view, is Skechers ability to take share in the fast-growing global athletic footwear market due to its exceptional product development, marketing, inventory management, and direct-to-consumer selling capabilities."

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