This ‘Strong Buy’ Retail Stock Has Great Earnings Growth and Has Doubled This Year

Citi Trends (CTRN) has strong technical momentum and just hit a new three-year high.
Shares are up more than 130% over the past year.
CTRN has a 100% “Buy” opinion from Barchart and a Trend Seeker “Buy” signal.
Fundamentals are improving with projected revenue and earnings growth, and positive sentiment from Wall Street analysts and retail investors.

Today’s Featured Stock

Valued at $364 million, Citi Trends (CTRN) is a value retailer of fashion apparel, accessories, and home goods, that primarily serves African-American and Latino families in the U.S. It offers apparel, such as fashion sportswear and footwear, as well as apparel for kids.

What I’m Watching

I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals; superior current momentum in both strength and direction; and a Trend Seeker “buy” signal. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation. CTRN checks those boxes. Since the Trend Seeker signaled a new “Buy” on Oct. 9, the stock has gained 23.84%.

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Barchart Technical Indicators for Citi Trends

Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.

Citi Trends hit a 3-year high of $45.25 in morning trading on Nov. 25.

CTRN has a Weighted Alpha of +116.14.
Citi Trends has a 100% “Buy” opinion from Barchart.
The stock gained 130% over the past year.
CTRN has its Trend Seeker “Buy” signal intact.
The stock recently traded at $44.97 with a 50-day moving average of $36.
Sinclair has made 11 new highs and gained 23.22% in the last month.
Relative Strength Index (RSI) is at 77.01.
There’s a technical support level around $41.82.

Don’t Forget the Fundamentals

$364 million market capitalization.
Revenue is projected to grow 6.04% this year and another 5.38% next year.
Earnings are estimated to increase 77.81% this year and an additional 160.20% next year.

Analyst and Investor Sentiment on Citi Trends

I don’t buy stocks because everyone else is buying, but I do realize that if major firms and investors are dumping stock, it’s hard to make money swimming against the tide.

It looks like Wall Street and individual investors like this stock.

The Wall Street analysts tracked by Barchart have issued 2 “Strong Buy” opinions on the stock with price targets between $43 and $53.
Value Line rate the stock “Above Average.”
CFRA’s MarketScope Advisor rates it a “Hold.”
Morningstar thinks even with the stock’s recent runup, it’s fairly valued.
627 investors following the stock on Motley Fool think it will beat the market while 188 think it won't.
2,590 investors monitor the stock on Seeking Alpha, which rates the stock a “Strong Buy.”

The Bottom Line on Citi Trends

With 591 stores across 33 states and new management realigning the operations, this may be a turnaround opportunity.

Today’s Chart of the Day was written by Jim Van Meerten. Read previous editions of the daily newsletter here.

Additional disclosure: The Barchart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.

On the date of publication, Jim Van Meerten did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.

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