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CATO 
Cato Corporation (CATO)
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Upturn Advisory Summary
02/20/2026: CATO (1-star) is currently NOT-A-BUY. Pass it for now.
Upturn Star Rating
Not Recommended Performance
These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.
Key Highlights
Company Size Small-Cap Stock | Market Capitalization 54.47M USD | Price to earnings Ratio - | 1Y Target Price 23 |
Price to earnings Ratio - | 1Y Target Price 23 | ||
Volume (30-day avg) - | Beta 0.79 | 52 Weeks Range 2.19 - 6.70 | Updated Date 06/29/2025 |
52 Weeks Range 2.19 - 6.70 | Updated Date 06/29/2025 | ||
Dividends yield (FY) 18.09% | Basic EPS (TTM) -1.34 |
Earnings Date
Report Date - | When - | Estimate - | Actual - |
Profitability
Profit Margin -4% | Operating Margin (TTM) 1.78% |
Management Effectiveness
Return on Assets (TTM) -4.17% | Return on Equity (TTM) -14.22% |
Valuation
Trailing PE - | Forward PE - | Enterprise Value 107115138 | Price to Sales(TTM) 0.08 |
Enterprise Value 107115138 | Price to Sales(TTM) 0.08 | ||
Enterprise Value to Revenue 0.17 | Enterprise Value to EBITDA 22.38 | Shares Outstanding 17973400 | Shares Floating 13553370 |
Shares Outstanding 17973400 | Shares Floating 13553370 | ||
Percent Insiders 18.19 | Percent Institutions 36.99 |
Upturn AI SWOT
Cato Corporation
Company Overview
History and Background
Cato Corporation was founded in 1946 by John Cato in Charlotte, North Carolina. It began as a small women's apparel store and has since grown into a publicly traded company operating a chain of retail stores. Key milestones include its IPO in 1987 and expansion across the United States.
Core Business Areas
- Apparel Retail: Cato Corporation operates a chain of specialty retail stores offering fashionable apparel, accessories, and footwear for women and girls. The stores are typically located in strip malls and shopping centers, providing convenient access to value-oriented fashion.
Leadership and Structure
Cato Corporation is led by a management team that includes a CEO, CFO, and other senior executives responsible for overseeing operations, merchandising, marketing, and finance. The company operates through a decentralized structure with regional management overseeing store operations.
Top Products and Market Share
Key Offerings
- Women's Apparel: [object Object]
- Accessories: [object Object]
- Footwear: [object Object]
Market Dynamics
Industry Overview
The women's apparel retail industry is highly competitive and subject to fashion trends, economic conditions, and evolving consumer preferences. The rise of e-commerce has also significantly impacted traditional brick-and-mortar retailers, necessitating a strong omni-channel strategy.
Positioning
Cato Corporation positions itself as a provider of affordable, on-trend fashion for women and girls. Its competitive advantages lie in its value proposition, broad store footprint in accessible locations, and a loyal customer base that appreciates its price points and merchandise selection. The company focuses on a 'fashion-right, price-right' strategy.
Total Addressable Market (TAM)
The total addressable market for women's apparel in the US is in the hundreds of billions of dollars. Cato Corporation operates within the affordable fashion segment of this market, targeting a significant portion of value-seeking consumers. Its market share is relatively small compared to the overall apparel market but significant within its specific niche.
Upturn SWOT Analysis
Strengths
- Value-oriented pricing strategy appealing to a broad customer base.
- Extensive store network in accessible locations.
- Established brand recognition within its target demographic.
- Strong private label offerings.
Weaknesses
- Limited online presence and e-commerce capabilities compared to competitors.
- Reliance on brick-and-mortar sales, making it vulnerable to foot traffic declines.
- Perceived lack of high-fashion or aspirational branding.
- Susceptibility to supply chain disruptions and inventory management challenges.
Opportunities
- Expansion of e-commerce platform and digital marketing efforts.
- Introduction of new product categories or private label brands.
- Leveraging data analytics to personalize customer experiences and optimize inventory.
- Strategic partnerships or collaborations to expand reach.
Threats
- Intensifying competition from online retailers and discount chains.
- Changing fashion trends and consumer preferences.
- Economic downturns impacting consumer discretionary spending.
- Rising operational costs (rent, labor, and supply chain).
Competitors and Market Share
Key Competitors
- TJX Companies (TJX)
- Ross Stores (ROST)
- Burlington Stores (BURL)
Competitive Landscape
Cato Corporation competes in a highly fragmented market. Its key advantage is its strong value proposition and accessible store locations. However, it lags behind larger competitors like TJX Companies, Ross Stores, and Burlington Stores in terms of scale, e-commerce infrastructure, and brand breadth. These larger players often have more sophisticated supply chains and marketing capabilities.
Growth Trajectory and Initiatives
Historical Growth: Historically, Cato Corporation has demonstrated growth through store expansion and increased sales volume. However, in recent years, the company has faced challenges in maintaining consistent growth due to the evolving retail landscape.
Future Projections: Future growth projections for Cato Corporation depend on its ability to adapt to e-commerce trends, optimize its store portfolio, and effectively manage its merchandise assortment to meet consumer demand. Analyst estimates often reflect these challenges and opportunities.
Recent Initiatives: Recent initiatives likely focus on enhancing the online shopping experience, optimizing inventory management, and potentially exploring new store formats or brand extensions to drive future growth.
Summary
Cato Corporation is a well-established value-oriented apparel retailer with a strong brick-and-mortar presence. Its strengths lie in its accessible pricing and store locations, appealing to a loyal customer base. However, the company faces significant challenges from the digital shift in retail and intense competition from larger, more diversified players with stronger e-commerce capabilities. To thrive, Cato must accelerate its digital transformation and adapt its merchandise strategy to remain relevant in a dynamic market.
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Sources and Disclaimers
Data Sources:
- Cato Corporation Investor Relations
- SEC Filings (10-K, 10-Q)
- Industry Analyst Reports
- Financial News Websites
Disclaimers:
This JSON output is for informational purposes only and does not constitute financial advice. Market share data is an estimation and may vary. Financial performance and projections are based on publicly available information and are subject to change. Investors should conduct their own due diligence before making any investment decisions.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About Cato Corporation
Exchange NYSE | Headquaters Charlotte, NC, United States | ||
IPO Launch date 1987-04-23 | Chairman, President & CEO Mr. John P. Derham Cato | ||
Sector Consumer Cyclical | Industry Apparel Retail | Full time employees 7000 | Website https://www.catofashions.com |
Full time employees 7000 | Website https://www.catofashions.com | ||
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, Retail and Credit. The company's stores and e-commerce websites offer a range of apparel and accessories, including dressy, career, and casual sportswear; and dresses, coats, shoes, lingerie, costume jewelry, and handbags, as well as men's wear, and lines for kids and infants. It operates its stores and e-commerce websites under the Cato, Cato Fashions, Cato Plus, It's Fashion, It's Fashion Metro, and Versona names. It also provides credit card services and layaway plans for customers. The Cato Corporation was incorporated in 1946 and is headquartered in Charlotte, North Carolina.
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