Value
6.9/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 2.3 |
| P/S | 10.0 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 7.6 |
| PEG | 10.0 |
- ▸Forward P/E: 16.2x
- ▸PEG: 0.07
CTRN · Why this verdict
Why Citi Trends (CTRN) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictHOLD
Overall score5.5/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Citi Trends shows recovering revenue and mostly beating earnings with a large gap to the analyst target, but weak cash conversion, a 26% short interest and a market cap below the $400M minimum keep it speculative.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
At $45.41 the stock trades 70.3% below the $77.35 analyst target, with only 10.5% downside to support, a reward-to-risk of 6.7. Upside pct | Price moves toward the analyst target while holding above the $43.22 support level over 12 months. | →Stable |
| CounterAnalyst targets are often stale for a small apparel retailer, and a 42% drawdown from the 52-week high shows the market does not believe them. | ||
Citi Trends beat EPS estimates in 3 of the last 4 quarters, including a 242.76% surprise in the June 2026 quarter and a 113.75% surprise in August 2026. Last 4 quarters | Earnings keep beating consensus, supporting a re-rating over the next four quarters. | →Stable |
| CounterThe beats come off very low or negative estimates, and the December 2025 quarter was still a loss of -0.88 per share. | ||
Quarterly revenue of $211.6M for the period ending August 2026 is about 10.9% above the $190.75M of a year earlier, and the next-quarter estimate is $215.8M. Revenue quarters | Year-over-year revenue growth stays positive through the next four quarters. | →Stable |
| CounterRevenue fell sequentially from $230.9M to $211.6M, and a low-income apparel retailer is exposed to consumer weakness. | ||
A Piotroski F-Score of 7/9 points to improving fundamentals, even though free cash flow is only 40% of net income. Quality breakdown | Cash conversion improves and the F-Score stays strong as profits normalize. | →Stable |
| CounterEarnings quality is flagged as a red flag at 40% FCF/NI, and the operating margin component scores 0.0, so the profits may not be backed by cash. | ||
A market cap of $379M, below the $400M minimum, combined with 26% short interest and 196% implied volatility keeps this a high-risk speculative holding. Key risks | Market cap grows above the $400M floor as earnings improve, reducing size and liquidity risk. | →Stable |
| CounterInsiders sold $726,285 in 90 days with no buying, and heavy short interest suggests informed skepticism. | ||
At $45.41 the stock trades 70.3% below the $77.35 analyst target, with only 10.5% downside to support, a reward-to-risk of 6.7.
→StableUpside pct
- Expectation
- Price moves toward the analyst target while holding above the $43.22 support level over 12 months.
CounterAnalyst targets are often stale for a small apparel retailer, and a 42% drawdown from the 52-week high shows the market does not believe them.
Citi Trends beat EPS estimates in 3 of the last 4 quarters, including a 242.76% surprise in the June 2026 quarter and a 113.75% surprise in August 2026.
→StableLast 4 quarters
- Expectation
- Earnings keep beating consensus, supporting a re-rating over the next four quarters.
CounterThe beats come off very low or negative estimates, and the December 2025 quarter was still a loss of -0.88 per share.
Quarterly revenue of $211.6M for the period ending August 2026 is about 10.9% above the $190.75M of a year earlier, and the next-quarter estimate is $215.8M.
→StableRevenue quarters
- Expectation
- Year-over-year revenue growth stays positive through the next four quarters.
CounterRevenue fell sequentially from $230.9M to $211.6M, and a low-income apparel retailer is exposed to consumer weakness.
A Piotroski F-Score of 7/9 points to improving fundamentals, even though free cash flow is only 40% of net income.
→StableQuality breakdown
- Expectation
- Cash conversion improves and the F-Score stays strong as profits normalize.
CounterEarnings quality is flagged as a red flag at 40% FCF/NI, and the operating margin component scores 0.0, so the profits may not be backed by cash.
A market cap of $379M, below the $400M minimum, combined with 26% short interest and 196% implied volatility keeps this a high-risk speculative holding.
→StableKey risks
- Expectation
- Market cap grows above the $400M floor as earnings improve, reducing size and liquidity risk.
CounterInsiders sold $726,285 in 90 days with no buying, and heavy short interest suggests informed skepticism.
Per-dimension breakdown
Quality
3.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.1 |
| ROA | 0.5 |
| Gross margin | 4.0 |
| Op margin | 0.0 |
| Net margin | 0.4 |
| Current ratio | 4.4 |
| FCF quality | 3.2 |
| Moat | 5.6 |
| Piotroski F | 7.8 |
- ▸Earnings quality RED FLAG: 40% FCF/NI
- ▸Strong Piotroski F-Score: 7/9
Growth
7.6/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.2 |
| EPS growth | 10.0 |
Momentum
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 8.7 |
| OBV | 10.0 |
| MA position | 2.2 |
| Volume | 10.0 |
| vol acceleration | 5.5 |
- ▸Capitulation risk (RSI 30, below 200MA)
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA but MA still rising (+1.6%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 10.0 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 100%
Insider
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 6.8 |
| notable moves | 7.0 |
- ▸Notable insider selling — $726,285 (0.192% of mkt cap)
Peer rank
3.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.3 |
| quality rank | 0.0 |
| growth rank | 6.7 |
Technical
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.4 |
| support resistance | 7.9 |
| 52w position | 1.7 |
Risk (lower is worse)
1.8/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 0.0 |
| days to cover | 3.3 |
| volatility | 0.0 |
| implied vol | 0.0 |
| beta | 3.9 |
| debt equity | 3.4 |
- ▸High short interest: 25%
- ▸High IV: 220%
Catalyst
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Strong earnings: 3B/1M
How the verdict was assembled
Engine trigger
Market cap $379M below $400M minimum. Not in investable universe.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:MARKET_CAPPassed (6)
- MOMENTUM:6.6>=5.5
- ASYMMETRY:6.6>=1.5
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:32d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (2)
- INSIDER:0.19%=MODERATE
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
6.63
Upside
+70.4%
Downside
10.6%
Sizing output
AVOID
SetupOversold Bounce — Oversold RSI 30, near Bollinger lower, volume surge
EdgeNo clear edge — No clear edge identified
SuitabilitySpeculative — Drawdown -42% (>40% off 52w high)
Investment implication
The HOLD_IF_HOLDING verdict reflects clean gate clearance against Growth at 7.6 and asymmetric R:R of 6.63.
The strongest dimensions are Growth at 7.6, Value at 6.9, and Catalyst at 6.7; the weakest are Risk (lower is worse) at 1.8, Peer rank at 3.1, and Quality at 3.1. The V9 engine cleared all gates with 2 warnings, producing an asymmetric reward-to-risk of 6.63 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Analyst Target Asymmetry
Trip ifShare price falls below the $43.22 support level, leaving less than 10% of the 70.3% upside as cushion.
- P2Consistent Earnings Beats
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P3Revenue Recovery Trend
Trip ifYear-over-year quarterly revenue growth falls below 5% from the current 10.9%.
- P4Piotroski Vs Cash Conversion
Trip ifPiotroski F-Score falls below 5 of 9 from the current 7.
- P5Small Cap Short Interest Risk
Trip ifShort interest rises above 30% from the current 26%.