Fund 1 Investments, LLC Boosts Stake in Citi Trends Inc
On October 6, 2023, Fund 1 Investments, LLC (Trades, Portfolio) made a significant addition to its portfolio by acquiring 908,792 shares of Citi Trends Inc (NASDAQ:CTRN). The transaction saw the firm increase its holdings by 182.56%, adding 587,166 shares at a trade price of $22.19. This move had a 5.09% impact on the firm's portfolio, raising its position in Citi Trends Inc to 7.88% and its holdings in the traded stock to 10.62%.
About Fund 1 Investments, LLC (Trades, Portfolio)
Fund 1 Investments, LLC (Trades, Portfolio), a firm based in Rincon, Puerto Rico, manages an equity portfolio worth $243 million. The firm holds 66 stocks, with its top holdings being Amazon.com Inc (NASDAQ:AMZN), Children's Place Inc (NASDAQ:PLCE), Tile Shop Holdings Inc (NASDAQ:TTSH), Tilly's Inc (NYSE:TLYS), and J.Jill Inc (NYSE:JILL). The firm's investment philosophy is primarily focused on the Consumer Cyclical and Consumer Defensive sectors.
Overview of Citi Trends Inc
Citi Trends Inc, a US-based company, is a leading retailer of urban fashion apparel and accessories. The company's product portfolio includes fashion sportswear for men, women, and children, as well as accessories, home products, beauty products, books, and toys. The company operates through various segments, including Accessories & Beauty, Footwear, Home & Lifestyle, Kids, Ladies, and Mens. Since its IPO on May 18, 2005, the company has grown to a market capitalization of $195.603 million.
Analysis of Citi Trends Inc's Stock
As of October 7, 2023, Citi Trends Inc's stock is trading at $22.84, with a PE percentage of 9.48. According to GuruFocus's valuation, the stock is modestly undervalued with a GF Value of $32.15. The stock's price to GF Value ratio stands at 0.71, indicating a potential upside. Since its IPO, the stock has gained 34.75%, despite a year-to-date decline of 14.87%.
Evaluation of Citi Trends Inc's Performance
Citi Trends Inc has a strong GF Score of 93/100, indicating high outperformance potential. The company's financial strength is rated 5/10, with a profitability rank of 8/10. The company's growth rank is 10/10, indicating strong growth potential. The company's GF Value Rank and Momentum Rank are both 9/10, suggesting a strong value proposition and momentum. The company's Piotroski F-Score is 4, and its Altman Z score is 2.86, indicating moderate financial health.
Examination of Citi Trends Inc's Industry Position
Citi Trends Inc operates in the Retail - Cyclical industry. The company has a ROE of 12.63 and a ROA of 3.69. The company's gross margin growth is 1.10, while its operating margin growth is -2.40. Over the past three years, the company has seen a revenue growth of 13.10%, EBITDA growth of 52.80%, and earning growth of 72.00%.
Analysis of Citi Trends Inc's Future Predictability
While the predictability rank of Citi Trends Inc is not available, the company's RSI 14 Day stands at 52.02, indicating a neutral momentum. The company's Momentum Index 6 - 1 Month is 23.64, and its Momentum Index 12 - 1 Month is 18.83, suggesting a moderate momentum in the short term.
Conclusion
In conclusion, Fund 1 Investments, LLC (Trades, Portfolio)'s recent acquisition of Citi Trends Inc shares is a strategic move that could potentially yield significant returns given the company's strong growth potential and undervalued status. However, investors should also consider the company's moderate financial health and the current market conditions. As always, it is crucial to conduct thorough research and consider various factors before making investment decisions.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
This article first appeared on GuruFocus.
