10 Best Clothing Stocks To Buy Now

6. American Eagle Outfitters, Inc. (NYSE:AEO)

Upside from Current Levels: 17.87%

American Eagle Outfitters, Inc. (NYSE:AEO) is a multi-brand retailer operating internationally and in the US. The company targets a younger demographic through its trendy clothing and accessories, while also offering intimates, apparel, activewear, and swimwear through its Aerie brand. The company boasts strong brand recognition among young adults and teens, focusing on trendy and casual go-to styles. It also targets young women by emphasizing comfort and body positivity.

With more than 1,000 stores across the US, Canada, Mexico, and Hong Kong, American Eagle Outfitters (NYSE:AEO) is focusing its attention on strengthening its online presence to stay on top of the latest trends and compete with other fast fashion brands. The fast fashion company not only offers trendy apparel at affordable prices but also holds the attention of its target audience by quickly adapting to new trends.

The company recently signed the biggest office lease in New York this year for around 338,085 square feet of space in a 20-year deal to consolidate the footprints of the brands in its portfolio. This decision came after an exhaustive search by the company to find the perfect spot that could help it streamline and centralize all its brands under one roof, including Aerie, Offline by Aerie, Unsubscribed, Todd Snyder, and its namesake label.

In terms of valuation, American Eagle Outfitters (NYSE:AEO) is currently trading at a forward P/E of 15.57, which indicates a 26.17% discount to its sector.

In addition, the company reported $5.32 billion in revenue in February 2024, its highest-ever number since February 2020, primarily because of the company’s commitment to its target demographic: GenZ. Overall, the stock sports a consensus Buy rating among analysts. Its median price target indicates an upside of 17.87% from current levels.