AEO's 50-day moving average has kept a lid on any rallies since November
American Eagle Outfitters (NYSE:AEO) stock was looking to take a much needed climb today after a recent two-year low of $12.24 on Monday. Boosted by the demand for Aerie -- its sub-brand -- the retail company reported adjusted fourth-quarter profits of 37 cents per share, just over Wall Street's expected 36 cents per share. However, it doesn't seem as though it will be enough to bring American Eagle out of its slump. At last check, AEO stock is nearing those Monday lows, down 2.95% to trade at $12.49.
No fewer than eight analysts have trimmed their price targets this morning. JP Morgan came in with the lowest, cutting its target all the way down to $14. Analysts came in to today already in the bearish camp, with 11 out of 15 considering the stock a "hold" or worse.
AEO has found consistent resistance at its 50-day moving average, consolidating below this trendline since a mid-November bear gap. The security is down 41% in the last 12 months, and has now shed roughly half its value since a May 3 annual high of $24.30.
Short sellers have been heading for the exits amidst this downturn. Short interest is down 7% in the most recent reporting period, yet still accounts for a healthy 13.7% of AEO's available float.
In the options pits, puts are favored. AEO stock shows a Schaeffer's put/call open interest ratio (SOIR) of 1.35, ranking in the elevated 77th percentile.In other words, short-term options players have rarely been more put-heavy during the last 12 months.