Below we present the list of 5 Retailers Hedge Funds Are Bailing On As Inflation Soars. For our methodology and a more comprehensive list please see 10 Retailers Hedge Funds Are Bailing On As Inflation Soars.
5. American Eagle Outfitters Inc. (NYSE:AEO)
Number of Hedge Fund Shareholders: 27
American Eagle Outfitters Inc. (NYSE:AEO) suffered a steep drop in hedge fund ownership during Q3 of last year, before rebounding slightly in Q4. Nonetheless, the company has lost 40% of its hedge fund shareholders over the past four quarters. Kerr Neilsen’s Platinum Asset Management and Thomas Bailard’s Bailard Inc were among the many funds selling out of AEO in the last year.
American Eagle Outfitters Inc. (NYSE:AEO) had a strong 2021, but perhaps got caught in thinking the good times would persist well into 2022 despite the clear signs of a pending economic slump. The company achieved record sales last year, but also ended the year with record inventory levels, which jumped 23% in Q1 as sales growth slows back to single-digits. The company is likely to face margin pressure now as it seeks to unload its excess goods.
Cowen analyst Jonna Kim slashed the firm’s price target on American Eagle Outfitters Inc. (NYSE:AEO) to $13 from $25 after taking over coverage of the stock, while also downgrading it to ‘Market Perform’ from ‘Outperform’. Kim cites an understandably worrying mix of pressures facing the company, including sluggish demand, higher costs, and markdown pressure.