NYSE:CATO

Stock Analysis Report

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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. More Details


Snowflake Analysis

Flawless balance sheet and overvalued.


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

Stable Share Price: CATO has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-6.5%

CATO

-1.7%

US Specialty Retail

-1.9%

US Market


1 Year Return

-55.3%

CATO

21.5%

US Specialty Retail

13.1%

US Market

Return vs Industry: CATO underperformed the US Specialty Retail industry which returned 21.5% over the past year.

Return vs Market: CATO underperformed the US Market which returned 13.1% over the past year.


Shareholder returns

CATOIndustryMarket
7 Day-6.5%-1.7%-1.9%
30 Day9.4%-1.0%-2.9%
90 Day-3.2%19.0%8.2%
1 Year-53.3%-55.3%22.8%21.5%15.7%13.1%
3 Year-27.6%-41.4%70.4%62.8%38.4%29.1%
5 Year-68.8%-77.1%63.5%50.9%89.3%68.0%

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 compared to its fair value and its price relative to the market?

0.67x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate CATO's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate CATO's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: CATO is unprofitable, so we can't compare its PE Ratio to the US Specialty Retail industry average.

PE vs Market: CATO is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate CATO's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: CATO is good value based on its PB Ratio (0.7x) compared to the US Specialty Retail industry average (1.8x).


Next Steps

Future Growth

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

28.0%

Forecasted Retail industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Cato has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Cato performed over the past 5 years?

-37.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CATO is currently unprofitable.

Growing Profit Margin: CATO is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: CATO is unprofitable, and losses have increased over the past 5 years at a rate of 37.9% per year.

Accelerating Growth: Unable to compare CATO's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: CATO is unprofitable, making it difficult to compare its past year earnings growth to the Specialty Retail industry (-4.8%).


Return on Equity

High ROE: CATO has a negative Return on Equity (-12.33%), as it is currently unprofitable.


Next Steps

Financial Health

How is Cato's financial position?


Financial Position Analysis

Short Term Liabilities: CATO's short term assets ($280.7M) exceed its short term liabilities ($154.0M).

Long Term Liabilities: CATO's short term assets ($280.7M) exceed its long term liabilities ($176.2M).


Debt to Equity History and Analysis

Debt Level: CATO is debt free.

Reducing Debt: CATO has not had any debt for past 5 years.

Debt Coverage: CATO has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: CATO has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

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


Dividend Yield vs Market

Notable Dividend: Unable to evaluate CATO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate CATO's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CATO's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CATO's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: CATO is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CATO's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

12.0yrs

Average management tenure


CEO

John Derham Cato (70 yo)

21.33yrs

Tenure

US$5,271,448

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

Compensation vs Market: John's total compensation ($USD5.27M) is above average for companies of similar size in the US market ($USD1.34M).

Compensation vs Earnings: John's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
John Derham Cato
Chairman21.33yrsUS$5.27m11.24%
$ 20.1m
John Howe
Executive VP & CFO12yrsUS$1.15m0.54%
$ 973.1k
Michael Greer
Executive VP & Director of Stores(Leave of Absence)16.58yrsUS$957.70k0.35%
$ 623.5k
Gordon Smith
Executive VP and Chief Real Estate & Store Development Officer9.17yrsUS$873.93k0.29%
$ 517.7k
J. Fagan
VP & General Counselno datano datano data
Stephen Headley
Senior Vice President of Sourcing & MDSE Supportno datano data0.29%
$ 515.4k
Woody Cozart
Senior Vice President of GMM - Fashion Divisionno datano data0.32%
$ 579.7k
Shawn Smith
Secretaryno datano datano data
Jeffrey Shock
Senior VP & Controller11.67yrsno data0.10%
$ 184.9k
Christin Reische
Assistant Secretaryno datano data0.070%
$ 125.5k

12.0yrs

Average Tenure

60.5yo

Average Age

Experienced Management: CATO's management team is seasoned and experienced (12 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
John Derham Cato
Chairman21.33yrsUS$5.27m11.24%
$ 20.1m
Pamela S. Davies
Independent Director2.42yrsUS$107.58k0.042%
$ 75.0k
Bailey Patrick
Independent Director11.33yrsUS$123.08k0.10%
$ 181.7k
Bryan Kennedy
Lead Independent Directorno dataUS$123.08k0.089%
$ 159.8k
Daniel Stowe
Independent Director15.58yrsUS$112.58k0.15%
$ 262.4k
Thomas Henson
Independent Director9.33yrsUS$115.08k0.11%
$ 189.4k
Thomas Meckley
Independent Director11.33yrsUS$128.08k0.097%
$ 173.9k
Theresa Drew
Independent Director1.33yrsUS$87.58k0.026%
$ 46.6k

11.3yrs

Average Tenure

63.5yo

Average Age

Experienced Board: CATO's board of directors are seasoned and experienced ( 11.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

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$178.971m
  • Shares outstanding: 22.92m
  • Website: https://www.catofashions.com

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 Analysis2020/09/24 05:50
End of Day Share Price2020/09/23 00:00
Earnings2020/08/01
Annual Earnings2020/02/01


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.