Is The Sydney Sweeney Boost Already Fading For American Eagle Stock?

American Eagle Outfitters shares fell Monday after Bank of America Securities downgraded the retailer to Underperform, according to Benzinga. The downgrade cited tariff headwinds, slowing sales momentum, and limited earnings visibility. Analyst Christopher Nardone cut fiscal 2025 and 2026 earnings estimates by 8% and 30% to 65 cents and 95 cents, respectively, noting weaker Aerie sales and margin pressure from global tariffs. He reduced the price target from $11 to $10, projecting downside risk as sales growth remains capped at 3% to 5% and marketing spend trails peers. BofA said tariffs could squeeze margins by 20 basis points in 2025 and 70 in 2026, even with mitigation. While denim and the Sydney Sweeney ad campaign may boost near-term momentum, BofA warned that brand recovery is uncertain and Aerie’s weakness in intimates and swim could hinder growth. Shares last traded down 2.61%.