'Hottest ad out there': American Eagle jumps after Trump supports Sydney Sweeney ad

Shares in jeans maker American Eagle Outfitters jumped 19% after Trump came out in support of a controversial ad by the company. Some critics said the ad conjured up the racist theory of eugenics, but now Trump has weighed in, saying it is "the 'hottest' ad out there."

U.S. President Trump has backed a controversial ad by jeans maker American Eagle Outfitters starring actress Sydney Sweeney, known for the TV series Euphoria and White Lotus. "Sydney Sweeney, a registered Republican, has the 'HOTTEST' ad out there. It’s for American Eagle, and the jeans are 'flying off the shelves.'" he wrote on Truth Social.

Shares of American Eagle jumped as much as 19% today to $12.80 apiece, the biggest intraday gain since May 12, notes Bloomberg. Still, the stock remains off 25% year to date, according to MarketWatch.

Titled "Sydney Sweeney Has Great Jeans," the American Eagle promotional campaign started in July. In one of the ads, Sweeney zips up her jeans and says: "genes are passed down from parents to offspring often determining traits like hair color, personality and even eye color." Then, looking at the camera, she adds: "my jeans are blue," and flashes her blue eyes.

The video sparked a debate online: critics said the ad’s focus on the genes of a white, blond woman conjured up the racist theory of eugenics. Other social media users have said critics are reading too much into the ads, explains Bloomberg. 

According to MarketWatch, of the 12 analysts tracking American Eagle, only two have the stock as a "buy." The most common recommendation, "hold," was assigned to American Eagle by eight analysts. The Wall Street consensus target price is $11.40 per share, implying 6.5% upside versus Friday's closing price.

JPMorgan analyst Matthew Boss downgraded American Eagle from "neutral" to "underweight" on July 28 with a target price of $9 per share, which is 16% below the last close. He forecast second-quarter EPS of $0.18, slightly below the Wall Street consensus of $0.20, writes Investing.com. The downgrade comes amid continued same-store sales declines and heavier-than-expected margin compression. The gross margin has been hurt by foreign exchange and tariff headwinds, higher markdowns to clear inventory, and seasonal weakness in categories like shorts and swim that persisted throughout the second quarter, Boss notes.

He expects third-quarter EPS of $0.36, 12% below the consensus due to increased SG&A spend from advertising campaigns and continued pressure on gross margins. For the full-year 2025, EPS of $0.75 is expected, also below the consensus of $0.78, with downside risk continuing into 2026, where Boss's EPS estimate stands 15% below the Wall Street.

The AI translation of this story was reviewed by a human editor.