American Eagle Outfitters' (NYSE: AEO) stock recently tumbled after the apparel retailer posted its third-quarter earnings. The drop might have surprised some investors since AEO beat analysts' expectations on the top and bottom lines.
AEO's revenue rose 6% annually to $1.07 billion, beating estimates by $10 million. Its net income fell 6% to $80.8 million, but its EPS -- buoyed by buybacks -- stayed flat at $0.48 and beat expectations by a penny. Let's look beyond the headline numbers at six main issues to see if its post-earnings drop was justified.
Image source: Aerie.