American Eagle's Smart Tactic for Dominating the Teen Market

Since CEO Robert Hansen took over American Eagle last year, the company has become the analyst favorite in teen retail, with earnings per share up a stunning 37 percent from a year earlier. Meanwhile, Abercrombie & Fitch is just stabilizing and Aeropostale is struggling. The reason American Eagle is doing so well is because it's doing one thing better than anyone else in the business, according to Dorothy Lakner, an analyst at Caris & Co. It comes down to merchandise assortment.