American Eagle Outfitters Inc. (NYSE: AEO) shares rose on Thursday Dec 1 with lighter trade volume than normal after a number of analysts weighed in on the investing value of the stock, increasing the price target of stock.
Meanwhile, U.S. stocks opened with slight gains on Thursday.
The Dow Jones Industrial Average DJIA, +0.31% rose 38.22 points, or 0.2%, to 19,174, while the S&P 500 SPX, +0.01% added 2.1 points to 2,202, a rise of 0.1%.
The Nasdaq Composite Index COMP, -0.32% rose less than 1 point to 5,323, essentially unchanged on the day.
American Eagle Outfitters Inc. (NYSE: AEO) had its price target raised by equities researchers at FBR & Co from $19.00 to $17.00. With a rating of Mkt Perform on the stock, the company has a 52-week high of $19.55. As a means of comparison, a number of other analysts have issued reports on the company recently, and American Eagle Outfitters Inc. has secured a consensus one-year price target of $19.14, higher than the opening price of $16.42.
Shares of American Eagle Outfitters Inc. (NYSE: AEO) opened at $16.42 on Tuesday and has traded in a range between, $16.42 and $16.90, and last traded at $16.79, a jump of $0.23 or 1.36% over the previous closing price.
American Eagle Outfitters Inc. (NYSE: AEO) now has a market cap of 3.05B.
American Eagle Outfitters Inc. (NYSE: AEO) Average Daily Trading Volume
The stock’s average daily volume is 4,448,420 shares out of a total float 164,753,000 and some 1,234,394 shares crossed the trading desk yesterday, lower than normal. Trading volume is likely to increase in the next few days as momentum traders often use upticks in trading volume to identify substantial volume aggregation or distribution by institutional investors.
As with all possible breakouts, investors look for volume to be at least 40%-50% higher than normal on the breakout to indicate that fund managers and other professional investors are jumping in.
Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.
Professional investors such as these retain teams of analysts researching thousands of stocks, so it is good corroboration to see them buying a stock you are considering.
American Eagle Outfitters Inc. (NYSE: AEO) 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 marking the activity of these professional investors and how they affect moving averages,it allows for traders to make more effective choices on trades.
With that in mind, American Eagle Outfitters Inc. (NYSE: AEO) now has a 50-day MA of $17.47 and 200-day MA of $17.15. It has traded in a 52-week range between $12.78 – 19.550 and today’s last price is 14.14%% lower than the 52 week high of $19.55.
Indeed, earnings growth is among the most important things to look at in regards to stock investing and, accordingly, investors seek companies that have been successful at growing their earnings at least 25% or more over the past 3 years.
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