Is Citi Trends outlook positive for June 2022?

CTRN
 Stock
  

USD 15.51  0.78  4.79%   

As many millenniums are trying to avoid consumer cyclical space, it makes sense to outline Citi Trends a little further and try to understand its current market patterns. We will analyze why it could be a much better year for Citi Trends shareholders. What is Citi Trends valuation so far in 2022? We are going to cover the entity perspective on valuation to give investors a better transparency on taking a position in it.
Published over three months ago
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The company currently holds 216.11 M in liabilities with Debt to Equity (D/E) ratio of 1.86, which is about average as compared to similar companies.
The firm shows a Beta (market volatility) of 2.0155, which signifies a somewhat significant risk relative to the market. Let's try to break down what Citi Trends's beta means in this case. As the market goes up, the company is expected to outperform it. However, if the market returns are negative, Citi Trends will likely underperform. Even though it is essential to pay attention to Citi Trends historical returns, it is always good to be careful when utilizing equity current trending patterns. Our philosophy towards foreseeing any stock's future performance is to check both, its past performance charts as well as the business as a whole, including all available technical indicators. Citi Trends exposes twenty-one different technical indicators, which can help you to evaluate its performance. Citi Trends has an expected return of -0.46%. Please be advised to confirm Citi Trends variance, value at risk, as well as the relationship between the Value At Risk and skewness to decide if Citi Trends performance from the past will be repeated at some point in the near future.
We determine the current worth of Citi Trends using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Citi Trends based exclusively on its fundamental and basic technical indicators. By analyzing Citi Trends's financials, quarterly and monthly indicators, and related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Citi Trends's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Citi Trends. We calculate exposure to Citi Trends's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Citi Trends's related companies.

Citi Trends Investment Alerts

Citi Trends investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring Citi Trends performance across your portfolios.Please check all investment alerts for Citi Trends

Citi Trends Valuation Ratios as Compared to Competition

Our valuation model uses many indicators to compare Citi Trends value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Citi Trends competition to find correlations between indicators driving the intrinsic value of Citi Trends.

How does Citi Trends utilize its cash?

To perform a cash flow analysis of Citi Trends, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Citi Trends is receiving and how much cash it distributes out in a given period. The Citi Trends cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.

Acquisition by Plutino Heather L of 6387 shares of Citi Trends subject to Rule 16b-3

Legal trades by Citi Trends insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Citi Trends insider trading alert for grant of common stock by Plutino Heather L, EVP and CFO, on 29th of June 2022. This event was filed by Citi Trends Inc with SEC on 2022-06-29. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

A Deeper Perspective

The big decline in price over the last few months for Citi Trends could raise concerns from institutional investors as the firm is trading at a share price of 25.43 on 1,022,025 in volume. The company executives failed to add value to investors and position the firm supply of money to exploit market volatility in April. However, diversifying your holdings with Citi Trends or similar stocks can still protect your portfolios during high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 5.18. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the Citi Trends partners.
 2010 2021 2022 (projected)
Long Term Debt to Equity0.01020.0290.0255
Interest Coverage59.36855.62715.19

Margins Breakdown

Citi Trends profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or Citi Trends itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of Citi Trends profit margins.
0.42
Gross Margin
0.1
EBITDA Margin
Operating Margin1.83
EBITDA Margin0.1
Gross Margin0.42
Profit Margin0.04


Citi Trends PPandE Turnover is quite stable at the moment. Further, Citi Trends Net Income Per Employee is increasing over the last 5 years. Citi Trends PPandE Turnover is increasing over the last 5 years. Further, Citi Trends Net Income Per Employee is increasing over the last 5 years. The previous year's value of Citi Trends Net Income Per Employee was 1,864.

Analysis of Citi Trends

Latest Skewness is up to 0.03. Price may slide again.
As of the 24th of May, Citi Trends shows the risk adjusted performance of (0.17), and Mean Deviation of 4.31. Citi Trends technical analysis gives you the methodology to make use of historical prices and volume patterns to determine a pattern that approximates the direction of the firm's future prices. Put another way, you can use this information to find out if the firm will indeed mirror its model of historical prices and volume momentum, or the prices will eventually revert. We were able to interpolate data for nineteen technical drivers for Citi Trends, which can be compared to its rivals. Please confirm Citi Trends variance, value at risk, as well as the relationship between the Value At Risk and skewness to decide if Citi Trends is priced correctly, providing market reflects its regular price of 25.43 per share. Given that Citi Trends has jensen alpha of (0.45), we suggest you to validate Citi Trends's prevailing market performance to make sure the company can sustain itself at a future point.

The Bottom Line

Whereas some companies in the apparel retail industry are either recovering or due for a correction, Citi Trends may not be as strong as the others in terms of longer-term growth potentials. To conclude, as of the 24th of May 2022, our latest 90 days buy-or-sell advice on the company is Hold. We believe Citi Trends is currently undervalued with low odds of distress for the next two years.

Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of Citi Trends. Please refer to our Terms of Use for any information regarding our disclosure principles.

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