Will Citi Trends (CTRN) Miss Earnings Estimates? - Analyst Blog

Citi Trends, Inc. (CTRN), a value-priced retailer of urban fashion apparel and accessories, is slated to report its first-quarter fiscal 2014 results on May 21, 2014. In the last quarter, it posted a negative surprise of 10.0%. Let’s see how things are shaping up for this announcement.

Factors Influencing This Quarter

We believe that the severe winter will have an impact on the company’s first-quarter results as the industry witnessed lower footfall at the stores as consumers were unable to step out of their homes.

However, following the improvement of weather conditions through the second half of February and an extended winter (colder than usual) weather throughout March, the businesses of most retailers picked up. Increased promotions and demand for winter products helped clear the stocked up winter inventory in the second half of the first quarter. From profitability perspective, the colder-than-usual weather in March would have helped retailer to recover a portion of the loss suffered earlier in the quarter.

Earnings Whispers?

Our proven model does not conclusively show that Citi Trends is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. This is not the case here, as you will see below.

Negative Zacks ESP: ESP (Expected Surprise Prediction) for Citi Trends is -1.92% since the Most Accurate estimate stands at 51 cents per share, which is lower than the Zacks Consensus Estimate of 52 cents.

Zacks Rank #3 (Hold): Citi Trends’ Zacks Rank #3 increases the predictive power of ESP. However, we need to have a positive ESP to be confident of an earnings surprise.

Other Stocks to Consider

Here are some companies you may want to consider as our model shows they have the right combination to post an earnings beat:

L Brands, Inc. (LB) has an Earnings ESP of +1.96% and a Zacks Rank #3.

The Gap, Inc. (GPS) holds an Earnings ESP of +1.79% and a Zacks Rank #3.

Tiffany & Co. (TIF) with an Earnings ESP of +1.30% carries a Zacks Rank #3.

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CITI TRENDS INC (CTRN): Free Stock Analysis Report

GAP INC (GPS): Free Stock Analysis Report

L BRANDS INC (LB): Free Stock Analysis Report

TIFFANY & CO (TIF): Free Stock Analysis Report

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