American Eagle Outfitters, Inc. (NYSE:AEO) persists its position slightly strong in context of buying side, while shares price collapsed -1.76% during latest trading session.
To measure firm’s performance and profitability, we focus on ordinary profitability ratio, AEO has gross profit margin of 36.70% for trailing twelve months and operating margin is calculated as 8.90%, these are a better detectors to find consistency or positive/negative trends in a firm’s earnings. Following in trace line, returns on investment amplify the findings, the company’s ROI concludes as 16.00%; it gives idea for personal financial decisions, to compare a firm’s profitability or to compare the efficiency of different investments. The returns on assets of firm also on noticeable level, it has ROA of 14.30%, which signifies how profitable a firm is relative to its total assets.
American Eagle Outfitters, Inc. (NYSE:AEO) holds price to book ratio of 3.14 that presents much better indicator to find market price of a share price over its book value of equity for investment valuation. The goal is to unearth high-growth companies selling at low-growth prices, the price-to-book ratio (P/B) offers investors a handy, albeit fairly crude, approach to finding undervalued companies. It is, however, important to understand exactly what the ratio can tell you and when it may not be an appropriate measurement tool. In addition, the firm has price to earnings ratio of 16.02, which is authentic method to judge but not universal for all situation.
Taking look on ratio analysis, AEO has forward price to earnings ratio of 13.72, compare to its price to earnings ratio of 16.02. Adding one more ratio to find detail valuation of security, price to earnings growth ratio that stands at 1.11. The co is presenting price to cash flow as 10.88 and while calculating price to free cash flow it concluded at 18.51, the low single digit may indicate stock is undervalued and vice versa. On other hand, keeping in mind stable cash flows but few growth prospects make traders to value lower.
To make strengthen these views, the active industry firm has Quick Ratio of 1.00, which indicates firm has sufficient short-term assets to cover its immediate liabilities. In addition, the American Eagle Outfitters, Inc. (NYSE:AEO) has debt to equity ratio of 0.01, sometimes it remain same with long term debt to equity ratio. The firm has price volatility of 4.02% for a week and 3.29% for a month. Its beta stands at 0.80 times. Narrow down four to firm performance, its weekly performance was -9.68% and monthly performance was -14.50%.