NYSE:CATO

Stock Analysis Report

Executive Summary

The Cato Corporation, together with its subsidiaries, operates as a specialty retailer of fashion apparel and accessories primarily in the southeastern United States.

Snowflake

Fundamentals

Flawless balance sheet average dividend payer.

Risks

  • Cato is not covered by any analysts.

Similar Companies

Share Price & News

How has Cato's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-3.8%

NYSE:CATO

-2.7%

US Specialty Retail

-0.9%

US Market


1 Year Return

-47.9%

NYSE:CATO

2.4%

US Specialty Retail

3.8%

US Market

CATO underperformed the Specialty Retail industry which returned 2.5% over the past year.

CATO underperformed the Market in United States of America which returned 3.3% over the past year.


Share holder returns

CATOIndustryMarket
7 Day-3.8%-2.7%-0.9%
30 Day8.5%1.5%1.1%
90 Day0.1%-4.5%1.1%
1 Year-43.2%-47.9%4.0%2.4%6.1%3.8%
3 Year-52.5%-62.1%29.3%23.4%45.2%35.5%
5 Year-39.4%-54.7%65.7%51.9%59.9%42.1%

Price Volatility Vs. Market

How volatile is Cato's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Cato undervalued based on future cash flows and its price relative to the stock market?

10%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Cato's share price is below the future cash flow value, but not at a moderate discount (< 20%).

Cato's share price is below the future cash flow value, but not at a substantial discount (< 40%).


Price Based on Earnings

Cato is good value based on earnings compared to the US Specialty Retail industry average.

Cato is good value based on earnings compared to the United States of America market.


Price Based on Expected Growth

Unable to calculate PEG ratio for Cato, we can't assess if its growth is good value.


Price Based on Value of Assets

Cato is good value based on assets compared to the US Specialty Retail industry average.


Next Steps

Future Growth

How is Cato expected to perform in the next 1 to 3 years based on estimates from 0 analysts?

11.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Unable to determine if Cato is high growth as no revenue estimate data is available.

Cato's earnings are expected to grow by 11.6% yearly, however this is not considered high growth (20% yearly).

Unable to compare Cato's revenue growth to the United States of America market average as no estimate data is available.

Cato's earnings growth is positive but not above the United States of America market average.

Cato's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if Cato will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

How has Cato performed over the past 5 years?

-25.3%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Cato's year on year earnings growth rate was negative over the past 5 years and the most recent earnings are below average.

Cato's 1-year earnings growth exceeds its 5-year average (189.1% vs -25.3%)

Cato's earnings growth has exceeded the US Specialty Retail industry average in the past year (189.1% vs 11.1%).


Return on Equity

Cato has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).


Return on Assets

Cato used its assets less efficiently than the US Specialty Retail industry average last year based on Return on Assets.


Return on Capital Employed

Cato's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Cato's financial position?


Financial Position Analysis

Cato is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Cato's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Cato has no debt.

Cato has not taken on any debt in the past 5 years.

Cato has no debt, it does not need to be covered by operating cash flow.

Cato has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

High level of physical assets or inventory.

Cato has no debt, it does not need to be covered by short term assets.


Next Steps

Dividend

What is Cato's current dividend yield, its reliability and sustainability?

9.64%

Current Dividend Yield


Dividend Yield and Payments Analysis

Cato's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.44%).

Cato's dividend is above the markets top 25% of dividend payers in United States of America (3.78%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are not well covered by earnings (0.9x coverage).


Future Payout to Shareholders

Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.


Next Steps

Management

What is the CEO of Cato's salary, the management and board of directors tenure and is there insider trading?

10.8yrs

Average management tenure


CEO

John Derham Cato (69yo)

20.2yrs

Tenure

US$4,283,283

Compensation

Mr. John P. Derham Cato has been the Chairman of The Cato Corporation since January 2004 and also has been its President and Chief Executive Officer since June 1997 and May 1999 respectively. From May 1999 ...


CEO Compensation Analysis

John's remuneration is higher than average for companies of similar size in United States of America.

John's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

10.8yrs

Average Tenure

59.5yo

Average Age

The average tenure for the Cato management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

10.2yrs

Average Tenure

62.5yo

Average Age

The average tenure for the Cato board of directors is over 10 years, this suggests they are a seasoned and experienced board.


Insider Trading

No 3 month individual insider trading information.


Recent Insider Transactions

BuyUS$3,42919 Mar 19
Daniel Stowe
EntityIndividual
Role
Member of the Board of Directors
Shares216.72
Max PriceUS$21.13
BuyUS$92805 Jan 19
Daniel Stowe
EntityIndividual
Role
Member of the Board of Directors
Shares64.38
Max PriceUS$14.41

Ownership Breakdown


Management Team

  • Shawn Smith

    Secretary

  • John Derham Cato (69yo)

    Chairman

    • Tenure: 20.2yrs
    • Compensation: $4.28m
  • Woody Cozart

    Senior Vice President of GMM - Fashion Division

  • Christin Reische

    Assistant Secretary

  • Tim Greer (56yo)

    Executive VP & Director of Stores

    • Tenure: 15.4yrs
    • Compensation: $924.05k
  • Gordon Smith (63yo)

    Executive VP and Chief Real Estate & Store Development Officer

    • Tenure: 8.0yrs
    • Compensation: $841.53k
  • John Howe (56yo)

    Executive VP & CFO

    • Tenure: 10.8yrs
    • Compensation: $1.13m
  • Stephen Headley

    Senior Vice President of Sourcing & MDSE Support

  • Jeff Shock

    Senior VP & Controller

    • Tenure: 10.5yrs

Board Members

  • John Derham Cato (69yo)

    Chairman

    • Tenure: 15.5yrs
    • Compensation: $4.28m
  • Pamela S. Davies (62yo)

    Director

    • Tenure: 1.3yrs
    • Compensation: $138.28k
  • Bailey Patrick (57yo)

    Independent Director

    • Tenure: 10.2yrs
    • Compensation: $152.78k
  • Bryan Kennedy (61yo)

    Lead Independent Director

    • Compensation: $165.76k
  • Daniel Stowe (63yo)

    Independent Director

    • Tenure: 14.4yrs
    • Compensation: $154.95k
  • Tom Henson (64yo)

    Independent Director

    • Tenure: 8.2yrs
    • Compensation: $140.35k
  • Thomas Meckley (74yo)

    Independent Director

    • Tenure: 10.2yrs
    • Compensation: $167.28k
  • Theresa Drew (61yo)

    Director

    • Tenure: 0.2yrs

Company Information

The Cato Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Cato Corporation
  • Ticker: CATO
  • Exchange: NYSE
  • Founded: 1946
  • Industry: apparel retail
  • Sector: retail
  • Market Cap: US$325.672m
  • Shares outstanding: 23.77m
  • Website: Click here

Number of Employees


Location

  • The Cato Corporation
  • 8100 Denmark Road
  • Charlotte
  • North Carolina
  • 28273
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CATONYSE (New York Stock Exchange)YesClass A Common StockUSUSDApr 1987
CO2ADB (Deutsche Boerse AG)YesClass A Common StockDEEURApr 1987

Biography

The Cato Corporation, together with its subsidiaries, operates as a specialty retailer of fashion apparel and accessories primarily in the southeastern United States. It operates through two segments, Reta ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/07/22 23:34
End of Day Share Price2019/07/22 00:00
Earnings2019/05/04
Annual Earnings2019/02/02


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.