Citi Trends (CTRN): Analyst Sees Above-Average Incremental Margins

Citi Trends, Inc. (NASDAQ:CTRN) is one of the Best Micro-Cap Stocks to Invest in According to Analysts.

On December 2, the company posted earnings for the third quarter, reporting a revenue of more than $197 million, up 10% compared to the revenue over the same period last year and beating market expectations by close to $10 million. In terms of guidance, the firm expects fourth-quarter comparable store sales to be up high single digits, and gross margin is expected to be in the range of 40% to 41%.

On December 3, DA Davidson analyst Michael Baker raised the price target on Citi Trends, Inc. (NASDAQ:CTRN) stock to $52 from $43 and kept a Buy rating on the shares. In an investor note, the analyst opined that there was a long way to go in this merchandise-driven turnaround since the company’s high single to low double digit comp momentum was continuing into the holidays. Baker further added that inventory was fresh, differentiated, and on-trend, and a high fixed cost structure meant above-average incremental margins.

Citi Trends, Inc. (NASDAQ:CTRN) operates as a value retailer of fashion apparel, accessories, and home goods.

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