06:15 AM EDT, 06/06/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We lower our 12-month price target by $7 to $10, based on 13.3x our FY 26 (Jan.) EPS estimate and in line with the company's five-year average forward P/E multiple of 13.4x. We lower our EPS estimates by $0.75 to $0.75 for FY 26 and by $0.20 to $1.55 for FY 27. AEO posted normalized Q1 EPS of -$0.29 vs. $0.34, $0.07 below consensus estimates on revenues of $1.09B vs. $1.14B, $5M below expectations. By brand in Q1, Aerie comparable sales declined 4%, while American Eagle declined 2%. Q1 gross margin compressed 1100 bps Y/Y to 29.6% due to inventory write-downs and higher in-season markdowns, as well as increased product costs. The company is executing on its accelerated share buyback program and expects to complete its $200M program in Q2, which should represent roughly 9% of fully diluted outstanding shares. We now expect AEO's earnings to recover slower than expected while the apparel and footwear sub-industry experiences higher promotional activity and slower demand in the U.S.