Will American Eagle Be The Next J.Crew?

american-eaglePhoto: Courtesy of American Eagle.
It's possible you haven't regularly shopped at American Eagle since your main source of income was babysitting money. But, now, it might actually be time to revisit the retailer, albeit for different reasons. Steve Forbes (yep, of Forbes) picked American Eagle as a safe stock investment for 2014.
Alongside household tech brands like Apple, Cisco, Microsoft, and IBM, American Eagle is kind of a left-field venture for those who typically don't see teen retailers as sure bets. For example, financial-service company The Motley Fool pinpointed Aeropostale and Abercrombie & Fitch as retailers that haven't been able to compete with the Urban Outfitters and H&Ms of the world. But, with Forbes' endorsement, it seems like American Eagle's "fantastic balance sheet, no debt, $2 per share in cash, [and] 3.5% dividend yield" will set it beyond the pack.
What does that signify for the company itself? Heritage wear is becoming more and more ubiquitous, which means American Eagle is poised to become a go-to brand for high-street shops, in much the same way J.Crew capitalized on the quirky-prep vibe of recent seasons. With fairly solid construction, affordable price points, and a trend-less vibe that's ironically becoming more in vogue right now (and let's not forget that it's a location in most malls across the U.S.), American Eagle might become the next mass retailer to see a renaissance. Just take a look at its wares: Isabel Marant-ish sherpa hoodies for $49.95, slouchy boyfriend jeans for $44.95, and resort wear that looks as sophisticated as something you'd find for 10 times the price. Plus, with a slew of seasonal discounts (like the 50%-off-everything sale right now), there's a ton of ongoing incentives to really load up. At the rate things are going, we might end up seeing you at the mall more in 2014! (Forbes)

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