This article was written by Gabriel Plat, a Financial Analyst at I Know First.
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This KSS stock forecast article was written by Maria Grishaev, Analyst at I Know First.
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Read The Full Premium Article“Fashion is part of the daily air and it changes all the time, with all the events. You can even see the approaching of a revolution in clothes. You can see and feel everything in clothes.”
– Diana Vreeland
(Source: Flickr)
Stein Mart, Inc. is a national discount retailer offering fashion merchandise, services
The company is working “to implement a comprehensive and attainable business plan geared toward accelerating revenue growth, rationalizing expenses and improving profitability. This includes identifying opportunities to expand our ecommerce sales platform, prioritizing inventory optimization and developing new partnerships and innovations that will help us
–John Cato, Chairman, President, and Chief Executive Officer
(Source: Wikimedia Commons)
On May 23, the I Know First algorithm gave the =&0=& a signal of 22.27 and predictability of .22 over a 14 day time horizon in the stocks under $20 forecast package. In accordance with the algorithm, over this time period from May 23 to June 6, the stock increased to $23.80 from a closing price of $17.46 on M ay 22, a gain of 36.33%.
Last year, Cato Fashions was one of the small specialty retailers struggling the most from the retail apocalypse. However, on May 24, CATO announced their earnings for Q1 2019 which were must better than expected and are beginning to show a promising future for the company. The company increased revenue to $23.4 million in Q1 2018 from $22.2 million in Q1 2017. This corresponded with EPS of $0.94 in comparison, an increase of 11%. Additionally, gross margin increased 1% to 39.7% thanks to lower buying and opportunity costs and higher merchandise margins. Sales decreased only 1% from last year to $236 million. However, for the 4 weeks ending on June 2, 2018, same store sales increased 9% to $77.3 million from the four week period ending on June 3, 2017. This pick up in sales is a major improvement for the specialty clothing brand as the retail industry has struggled with bringing customers into stores.
The gains of over 35% for CATO over the duration of the bullish forecast for the company highlight the accuracy of the I Know First algorithm.
Current I Know First subscribers received this bullish CATO forecast on May 23, 2018.
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