American Eagle Stock Impacted by Donald Trump Support
American Eagle is reaping the rewards of a very successful ad campaign that is being helped along by Donald Trump.
Quick overview
- American Eagle Outfitters' stock surged 23% after President Trump praised their ad campaign featuring Sydney Sweeney.
- Despite a recent retreat, AEO's stock remains significantly higher than a month ago, reflecting a 20% increase.
- The controversial ad campaign has generated considerable media attention, but analysts are concerned about its long-term impact on sales.
- Trump's endorsement continues to keep American Eagle in the public eye, potentially sustaining interest in their products.
American Eagle Outfitters (AEO) has been having a busy week, with a new ad campaign and social media support from President Donald Trump, and their stock is elevated now.
The stock price for American Eagle shot up by 23% on Tuesday after Trump posted on social media that they have the “HOTTEST ad out there”. The company has been in the media spotlight recently for their ad campaign featuring television and movie star Sydney Sweeney- an ad that has been heavily trending on social media.
After its meteoric rise took it to $13.12 per share, AEO stock retreated and is now at $12.28. However, the stock is climbing on Wednesday after Tuesday’s sharp turnaround. Those who missed out on investing in this stock after it gained momentum may still be able to turn a profit. The racy ad campaign that has stirred up a media firestorm is not likely to go anywhere soon.
How the Ad Campaign Has Helped American Eagle
Despite considerable backlash about the series of ads that American Eagle has run, the company is seeing renewed interest in their products. Many of the ads featured Sweeney in various stages of undress, and they focused on slogans about having good jeans/genes. The campaign messaging has resulted in backlash over the messaging that many consider to be in poor taste and even racist.
AEO’s stock is significantly higher since the campaign, even with the recent retreat. A month ago, their stock was selling for $10 per share, so the current price is an increase of 20%. At the start of the ad campaign, the company added $200 million to its market cap, and obviously their advertising methods are working.
The concern now that analysts have about the company is that the effects of its campaign may not last. Once the impact fades from social media, will sales still remain high? Investors should be concerned about how quickly the public will move on from this topic, but for now, Trump is keeping it alive and keeping American Eagle in the public consciousness. There is obviously more gas in the tank for the campaign, and American Eagle is benefitting from it with solid sales numbers.
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