Citi Trends, Inc. (NASDAQ:CTRN) shares surged Tuesday after the discount retailer posted a strong quarterly beat and issued upbeat full-year guidance.
The company reported fourth-quarter adjusted earnings per share of 85 cents, beating the analyst consensus estimate of 78 cents.
Quarter In Detail
Quarterly sales of $230.393 million (+9.1% year over year) outpaced the Street view of $227.424 million.
“Our fourth quarter results cap a transformational year for CITITRENDS. We delivered 8.9% comparable store sales growth in the fourth quarter, or 15.3% on a two-year basis, marking our sixth consecutive quarter of positive comps,” said Ken Seipel, Chief Executive Officer.
Comparable store sales increased 8.9% compared to the fourth quarter 2024, driven by increases in both traffic and basket, as a result of the improved three-tiered merchandise assortment.
Quarterly gross margin of 39.9% increased 20 basis points due to lower markdowns, benefiting from our improved merchandise assortment and value proposition.
Adjusted EBITDA rose to $11.9 million, up from $7.1 million in the prior-year period.
Citi Trends exited the quarter with cash and equivalents worth $66.092 million. Merchandise inventory was $113.5 million at the end of the quarter, a decrease of 7.4%.
Outlook
Citi Trends expects fiscal 2026 sales between $869.16 million and $885.56 million, topping the analyst estimate of $859.29 million.
For fiscal 2026, Citi Trends expects comparable-store sales growth of 5% to 7%, gross margin expansion of about 100 basis points, and adjusted SG&A leverage of 70 to 100 basis points.
The company also projects adjusted EBITDA of $34 million to $38 million, plans to open about 25 stores, remodel 50 locations, close four stores, and spend $35 million to $40 million in capital expenditures, mostly on new stores and remodels.
CTRN Price Action: Citi Trends shares were up 19.76% at $52.90 at the time of publication on Tuesday. The stock is trading at a new 52-week high, according to Benzinga Pro data.
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