The way Reese calculates the price-to-earnings-to-growth (PEG) ratio based on an average of historical, current and projected growth rates, AEO has a 0.33 PEG ratio.
Looking forward, we see attractive characteristics in three other names: QLogic Corp. ( QLGC), Magma Design Automation ( LAVA), and American Eagle Outfitters ( AEO).
The run up in the price of the underlying today as well as the rise in implied volatility on the stock seem to have set the stage for the massive position initiated in AEO options.