XVARY Composite Score
40
/ 100
Below Average
Combines growth, value, risk, and momentum factors into a single institutional-grade score.
Start here if you're new
What it is
Cato sells apparel, shoes, and accessories through 1,101 stores, plus a small online and credit business.
How it gets paid
Last year Cato made $650M in revenue. Cato Fashions stores was the main engine at $0.26B, or 40% of sales.
Why growth slowed
Revenue fell 8.2% last year. $502M of revenue shows the chain can still pull traffic.
What just happened
Quarterly sales hit $502M and profit came to $0.25 a share.
At a Glance
C++ balance sheet — some cracks in the foundation
10/100 earnings predictability — expect surprises
0.0% return on capital — nothing to write home about
-$0.97 fy2024 eps est
$650M fy2024 rev est
XVARY composite: 40/100 — below average
What They Do
Cato sells apparel, shoes, and accessories through 1,101 stores, plus a small online and credit business.
You are looking at 1,101 stores in 31 states. That is a lot of leases for a $650M business. The credit arm (the lending side) keeps your tab open after checkout, which helps a thin retail chain survive.
How They Make Money
$650M
annual revenue · their business grew -8.2% last year
Cato Fashions stores
$0.26B
8.2%
It's Fashion stores
$0.14B
8.2%
Versona stores
$0.09B
8.2%
E-commerce
$0.06B
8.2%
Credit services
$0.10B
0.0%
The Products That Matter
Value-priced women's apparel retail
cato stores
$660M trailing revenue · entire business
It is the whole company: a $660M retail operation that still lost $9.1M over the last twelve months, leaving a -1.4% net margin.
no segment diversification
Key Numbers
$0.97
FY2024 loss/share
You lost 97 cents for each share. The business is still not paying its own way.
$650M
FY2024 sales
That is the size of the machine. It is not huge, so small misses matter.
0.9%
operating margin
The business kept less than 1 cent from each sales dollar. That leaves almost no cushion.
0.0%
return on capital
New money earned 0% back. That is dead money.
Financial Health
C++
Strength
- balance sheet grade C++ — below average — limited financial resources
- risk rank 3 — safer than 50% of stocks
- price stability 20 / 100
C++ — below average. watch for debt servicing and cash burn.
Total Return vs. Market
source: institutional data · return history unavailable
What Just Happened
beat estimates
Quarterly sales hit $502M and profit came to $0.25 a share.
Revenue rose 223% from the prior year quarter. The quarter was better because the business got back to profit after a rough year.
$502M
revenue
$0.25
per-share profit
33.5%
gross margin
the number that mattered
$502M of revenue shows the chain can still pull traffic, even after a hard year.
source: company earnings report, 2026
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What Could Go Wrong
The top risk is continued cash burn in a shrinking apparel chain.
High
Continued operating losses
Cato reported a -$9.1M net loss and a -4.3% operating margin on $660M in trailing revenue. That is not a temporary-looking profit profile.
If the stores stay unprofitable, equity value keeps depending more on cash than on the business itself.
High
Free cash flow staying negative
Free cash flow was -$27.6M against a $78.9M cash balance. In plain English: the company has time, but not unlimited time.
At that burn rate, the cash cushion matters a lot more than any low price-to-sales argument.
Med
Sales decline and tariff pressure
Revenue fell -8.2% last year, and the weighted average applied tariff rate on imports is 18.2%. That is a bad setup for a value-priced apparel seller with no margin buffer.
If input costs rise while sales keep slipping, already negative margins can get worse fast.
A retailer losing $9.1M, burning $27.6M in free cash flow, and facing -8.2% sales shrinkage does not need a dramatic new problem. The current ones are enough.
Source: institutional data · regulatory filings · risk analysis
Pay Attention To
Calendar
Q1 2026 earnings report
Scheduled for March 19, 2026, pre-market. You want one thing first: evidence that the revenue slide is slowing.
Metric
Free cash flow vs. cash balance
With $78.9M in cash and -$27.6M in annual free cash flow, this is the scoreboard that matters most.
Trend
Whether the -8.2% sales decline starts to flatten
A bad retailer can look optically cheap for years. A stabilizing top line is the first sign that the story is changing.
Risk
Tariff policy and merchandise cost pressure
The 18.2% weighted average applied tariff rate on imports matters more when your operating margin is already -4.3%.
Analyst Rankings
earnings predictability
10 / 100
In human-speak, analysts do not trust these earnings to show up smoothly from quarter to quarter.
risk rank
3
That sits around the middle on broad stock risk. The problem is not hidden complexity. It is a simple weak business.
Source: institutional data
Institutional Activity
institutional ownership data for CATO is being compiled.
Source: institutional data
Price Targets
3-5 year target range
$3
Current price
Target midpoint · from current
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