One-glance verdict
Overvalued
$8.03 our estimate vs market $48.16
Wall Street consensus: $91.00 (1,033.2% higher than our fair-value estimate)
500% above our estimate, beyond the bull case
Fundamentals snapshot
Citi Trends, Inc.
CTRN · NMS · Consumer Cyclical · Apparel Retail
Current price
$48.16
52-week range
$34.80 - $77.91
Market cap
$401.63M
Balance sheet
Distressed
-20.50x Concerning
Net debt $168.96M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 6.1% last year.
- Reward Returns 6.2% on equity, ahead of 16% of its peers.
- Risk Stock trades 57.3% above its 5-year average P/E.
- Risk Operating margin compressed from 1.4% to -0.9% over 3 years.
What this company does
Citi Trends, Inc.
Citi Trends sells affordable clothing, accessories, and home goods for families, targeting value-conscious shoppers. Their main income comes from selling these trendy yet inexpensive items, which is important because it shows how well they are attracting customers with their pricing strategy.
How the company got here
Citi Trends started its journey in 1946, originally as Allied Fashion, Inc. It wasn't until 2001 that the company adopted its current name, Citi Trends. This rebranding marked a shift in focus, aiming to better reflect its position as a value retailer catering to a broad range of fashion-conscious consumers. Over the decades, the company has navigated the evolving retail landscape, adapting its offerings to remain relevant in the fast-paced apparel market.
What it actually does
Citi Trends operates as a value retailer, meaning it offers trendy clothing and accessories at affordable prices. Think of it as a place where you can find the latest styles without breaking the bank. They sell a wide variety of items, from everyday wear to more specific fashion pieces, catering to different age groups and sizes. Their goal is to provide fashionable options for the whole family, including apparel, shoes, and accessories.
Apparel and Accessories
This is the core of Citi Trends' business, making up the largest portion of its sales. They offer clothing for women in various sizes, including juniors, missy, and plus sizes, covering everything from sportswear to sleepwear. For children, they have a range of items for newborns, infants, toddlers, and older kids, including uniforms and accessories. Men's apparel, including big and tall sizes, is also a significant offering. Beyond clothing, they sell accessories like handbags, jewelry, belts, and beauty products, providing a one-stop shop for fashion needs.
Footwear
Citi Trends also sells a selection of casual and dress shoes for men, women, and children. This segment complements their apparel offerings, allowing customers to complete their outfits with appropriate footwear. While not as large as their apparel business, it contributes to the overall shopping experience by providing a broader range of products.
Home Goods and Other Trends
This segment includes a variety of items for the home, such as bedding, bath, and kitchen accessories, as well as decorative items. They also offer a mix of other products that fall under 'trends,' which can include books, food items, tech gadgets, toys, and seasonal merchandise. This diverse category allows Citi Trends to capture additional customer spending by offering a wider array of 'wants and needs' beyond just clothing and shoes.
What management is betting on now
Citi Trends is focused on providing the latest fashion trends at competitive prices to attract and retain value-conscious shoppers. Their strategy likely involves carefully selecting merchandise that appeals to their target demographic and managing inventory efficiently to keep costs low. By offering a broad assortment of apparel, accessories, footwear, and home goods, they aim to be a go-to destination for families looking for affordable style. The company's success hinges on its ability to anticipate fashion shifts and maintain its value proposition in a dynamic retail environment.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q4
$-20.41M
FY2026 Q1
$26.00M
FY2026 Q2
$-13.07M
FY2026 Q3
$-1.75M
FY2026 Q4
$767.00K
FY2027 Q2
$15.04M
FY2027 Q3
$-23.99M
Revenue
$211.63M
Net income
$-931.00K
Diluted EPS
-0.11
Operating cash flow
$-14.18M
Free cash flow
$-23.99M
Fetching…
Sources
Revenue
$230.86M
Net income
$7.75M
Diluted EPS
0.91
Operating cash flow
$20.88M
Free cash flow
$15.04M
Fetching…
Sources
Revenue
$197.09M
Net income
—
Diluted EPS
-0.86
Operating cash flow
$8.58M
Free cash flow
$767.00K
Fetching…
Sources
Revenue
$190.75M
Net income
$3.82M
Diluted EPS
0.46
Operating cash flow
$3.85M
Free cash flow
$-1.75M
Fetching…
Sources
Revenue
$201.73M
Net income
$871.00K
Diluted EPS
0.11
Operating cash flow
$-10.97M
Free cash flow
$-13.07M
Fetching…
Sources
Revenue
$211.17M
Net income
$-43.17M
Diluted EPS
-1.70
Operating cash flow
$28.50M
Free cash flow
$26.00M
Fetching…
Sources
Revenue
$179.07M
Net income
—
Diluted EPS
-0.86
Operating cash flow
$-18.35M
Free cash flow
$-20.41M
Fetching…
Sources
Is it cheap or expensive?
Fair value $8.03 vs current price $48.16
Wall Street consensus is the average analyst price target: $91.00 (1,033.2% higher than our fair-value estimate).
Our most-likely fair value is $8.03 a share — about 83.3% below today's price of $48.16, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Distressed
Net debt $169.0M. Interest coverage -20.5x.
Net debt
$168.96M
Interest coverage
-20.50x
Citi Trends, Inc.'s profit covers its interest bill about 0.0 times over. which is weaker than most peers shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Distressed
Worse cushion
Baseline
Better cushion
CTRN
BASELINE
Citi Trends, Inc.
Total debt $224.85M Interest coverage -20.50x This is the baseline the peer rows are being compared against.
Total debt $4.74B Interest coverage 71.36x This peer still has a real interest-payment cushion, while CTRN does not.
Total debt $5.91B Interest coverage 11.89x This peer still has a real interest-payment cushion, while CTRN does not.
Total debt $14.32B Interest coverage 97.00x This peer still has a real interest-payment cushion, while CTRN does not.
Total debt $138.63M Interest coverage -122.37x Neither company has much profit cushion over interest right now.
What you should know
The case for and against CTRN
3 Rewards
2 Risks
Rewards
-
Revenue grew 6.1% last year.
-
Returns 6.2% on equity, ahead of 16% of its peers.
-
Free cash flow was positive in 7/10 years.
Risks
-
Stock trades 57.3% above its 5-year average P/E.
-
Operating margin compressed from 1.4% to -0.9% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
57.33x
Forward P/E
17.17x
P/B
3.13x
P/S
0.46x
EV/EBITDA
22.17x
PEG ratio
2.85x
Profitability
How much profit each dollar creates
Gross margin
39.8%
Operating margin
-0.9%
Net margin
0.8%
ROE
6.2%
ROA
0.7%
Health
Liquidity and balance-sheet strength
Debt / equity
1.80x
Current ratio
1.13x
Quick ratio
0.32x
Total debt
$224.85M
Total cash
$55.89M
Growth
How the business has been compounding
Revenue TTM
$869.97M
Revenue 5Y CAGR
-4.6%
EPS TTM
0.84
EPS 5Y CAGR
-55.5%
Cash flow
How much cash the business throws off
Operating CF TTM
$34.77M
Free CF TTM
$624.00K
FCF margin
0.1%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
2020-03-02