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American Eagle Outfitters Q4 Profit Meets View, Revenues Beat; Hikes Dividend

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Apparel retailer American Eagle Outfitters Inc. (AEO) on Thursday reported a 72 percent surge in profit for the fourth quarter from last year, aided by a double-digit increase in revenues and a benefit related to the recent U.S. tax reform.

Adjusted earnings per share for the quarter matched analysts' expectations, while revenues beat their estimates. In addition, the company raised its quarterly dividend by 10 percent and forecast first-quarter earnings above the Street estimates.

American Eagle's net income for the fourth quarter surged to $93.96 million or $0.52 per share from $54.62 million or $0.30 per share in the prior year.

The latest quarter's results include a tax benefit of $0.08 per share related to the recent U.S. tax reform, while the year-ago period's results included charges of $0.09 per share.

Excluding items, adjusted earnings per share were $0.44, compared to $0.39 per share in the year-ago period. On average, analysts polled by Thomson Reuters expected the company to report earnings of $0.44 per share. Analysts' estimates typically exclude special items.

Total net revenue for the quarter grew 12 percent to $1.23 billion from $1.10 billion last year. Analysts had a consensus revenue estimate of $1.21 billion for the quarter.

Consolidated comparable sales for the quarter rose 8 percent, compared to an increase of 0.4 percent in the year-ago period.

The company raised its quarterly dividend by 10 percent to $0.1375 per share. The dividend was declared on March 7, 2018 and is payable on April 27, 2018 to stockholders of record at the close of business on April 13, 2018.

Looking ahead to the first quarter of fiscal 2018, American Eagle forecast earnings of $0.20 to $0.22 per share, excluding potential asset impairment and restructuring charges. The outlook is based on an anticipated comparable sales increase in the mid-single digits.

In the year-ago period, the company's reported earnings were $0.14 per share and adjusted earnings were $0.16 per share.

The Street expects earnings of $0.19 per share for the first quarter.

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