Cato Comps Decline 1% in March on Easter Holiday Shift
After a strong February, The Cato Corporation CATO posted soft sales data for the five weeks ended Apr 2, 2016. Comparable-store sales (comps) for March fell 1% from the year-ago period. However, total sales rose 2% to $118.8 million from $117 million reported a year ago.
Shares of the company declined nearly 5.8% since the dismal comps were reported.
Comps in March were mainly impacted by the shift of Easter holiday to mid March this year from April in the prior year. Therefore, the company believes a combined report of March and April sales will provide a more accurate view of its performance.
For the nine weeks ended Apr 2, 2016, the company’s sales improved 3% to $203.6 million from $197.5 million in the prior-year period. Year-to-date, comps have inched up 1% from the prior-year period.
Despite the negative March comps, Cato reiterated its earnings per share guidance of $1.12–$1.16 for the first quarter of 2016.
Moreover, in March, Cato relocated and shut one store each. Consequently, the company operated 1,371 stores across 32 states as of Apr 2, 2016, marking an increase from 1,349 stores operated as of Apr 4, 2015.
Stocks to Consider
Some better-ranked stocks in the same industry include American Eagle Outfitters Inc. AEO and Express Inc. EXPR, both carrying a Zacks Rank #1 (Strong Buy), and Abercrombie & Fitch Co. ANF, holding a Zacks Rank #2 (Buy).
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