UPDATE: Bank of America Lowers PT on American Eagle Due to Lowered Guidance

Bank of America published a report on American Eagle AEO where it lowered it's price target from $24.00 to $23.00 due to lowered guidance and negative mid-single-digit comps. In the report, Bank of America stated, "Gross margins jumped 600bp y/y to 41.2% in 4Q, driven by lower product costs and markdowns. For the year, operating margins grew 300bp y/y to 12.4%. We expect product costs and markdowns to stay lower for 1H13, but for both factors to become less favorable in 2H13 as cotton costs have stabilized and as markdown comparisons become more challenging in Fall. Also, if comps remain weak, SG&A will rise as a percentage of sales." American Eagle closed Wednesday at $20.27.