Is American Eagle Outfitters, Inc. overvalued or undervalued?

As of 23 July 2025, the valuation grade for American Eagle Outfitters, Inc. moved from attractive to fair. The company appears to be fairly valued based on its current metrics. Key ratios include a P/E ratio of 11, an EV to EBITDA of 5.65, and a Price to Book Value of 1.75.
In comparison to peers, Gap, Inc. has a P/E of 10.22 and Urban Outfitters, Inc. shows a P/E of 13.77, indicating that American Eagle is positioned in the middle of its competitive landscape. Despite a strong dividend yield of 287.61% and a solid ROCE of 16.46%, the company has underperformed the S&P 500 over the past year with a return of -0.85% compared to the index's 17.14%, although it has outperformed in the 3-year period with a return of 80.09% versus 70.41% for the S&P 500.