American Eagle Outfitters Inc. (AEO) Shares Active after Upgrade at BMO Capital Markets

American Eagle Outfitters Inc. (NYSE: AEO) shares rose in value early today on lighter trade volume than normal after a number of analysts weighed in on the investing value of the stock with a upgraded rating.

Analysts at BMO Capital Markets upgraded shares of American Eagle Outfitters Inc. (NYSE: AEO) from Market Perform to Outperform today. The company currently has a rating of Outperform on the shares. The one-year price target of $20.09 is above the opening price of $18.02, that has caused a fair amount of other analysts to comment on the stock in recent days. Looking back over the last 52 weeks, American Eagle Outfitters Inc. stock has a high of $19.55. Share prices sometimes get a boost to the upside when analysts upgrade a stock.

Meanwhile, U.S. stock futures on Monday pointed to a higher open, as investors prepared for the start of earnings season

S&P 500 futures ESZ6, +0.44% rose by 9 points, or 0.4%, to 2,155.50, while Dow Jones Industrial Average futures YMZ6, +0.40% gained 64 points, or 0.4%, to 18,221.

Nasdaq-100 futures NQZ6, +0.42% tacked on 17.75 points, or 0.4%, to 4,876.75.Meanwhile, U.S. stock futures on Monday pointed to a higher open, as investors prepared for the start of earnings season

American Eagle Outfitters Inc. (NYSE: AEO) shares last traded at $18.04, which is an increase of $0.57 or 0.03 from the previous closing price. Opening at $18.02, they varied from $17.87 and $18.05 throughout the day.

American Eagle Outfitters Inc. (NYSE: AEO) now has a market cap of 3.28B.

American Eagle Outfitters Inc.Trading Volume

The stock’s average daily volume is 4,453,220 shares out of a total float 164,753,000 and some 849,504 shares crossed the trading desk yesterday, lower than the average. Look for trading volume to pick up in the coming days as momentum traders often use swings in trading volume to pinpoint heavy volume growth or circulation by institutional investors.

As with all potential breakouts, investors look for volume to be at least 40%-50% higher than normal on the breakout to show that fund managers and other professional investors are jumping in.

Institutional sponsorship just refers to ownership of a stock by mutual funds, banks, pension funds and other large institutions.

These professional investors retain substantial teams of analysts that investigate thousands of stocks. Thus, watching their interests is a good way to ensure you are buying the right stocks.

American Eagle Outfitters Inc. Moving Averages

A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.

This is because the average acts like a floor (support), so the price bounces up off of it.

In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.

By spotting trends, moving averages allow investors to make those trends work in their favor and increase the number of successful trades.

Trades for American Eagle Outfitters Inc. (NYSE: AEO) have ranged from $12.78 – 19.55, and the stock now has a 50-day MA of $18.24 and 200-day MA of $16.62. Today’s last price is 0.08% under the 52 week high of $19.55.

Earnings growth is a crucial factor to consider when buying stocks and investors seek companies that have increased their earnings at least 25% or more for 3 consecutive years.

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