Investors in Citi Trends Inc (NASDAQ:CTRN) may take note of recent insider activity, as filings with the Securities and Exchange Commission reveal a series of stock purchases by company insiders. The transactions took place between March 28 and April 2, with a total of 18,000 shares acquired at prices ranging from $26.9242 to $27.124, amounting to an aggregate value of $487,832.
These purchases were executed by entities associated with Pleasant Lake Partners LLC, a significant shareholder in the retail company. According to the SEC filing, the shares are held for the benefit of private investment vehicles, including Pleasant Lake Onshore Feeder Fund, LP. Pleasant Lake Partners LLC serves as the investment adviser for these funds, with Fund 1 Investments, LLC acting as the managing member. Jonathan Lennon is the managing member of Fund 1 Investments, LLC.
It's important for investors to note that the reporting persons have disclaimed beneficial ownership of the reported shares, except to the extent of their pecuniary interest. This disclaimer is a common legal statement in SEC filings to indicate that while the reporting person has economic interest in the securities, they may not have direct control over the securities.
The transactions indicate a vote of confidence from the insiders in the company's prospects. Citi Trends, known for its value-priced urban fashion apparel and accessories, operates under the retail-apparel and accessory stores industry, a sector that often experiences shifts in consumer trends and spending patterns.
The insider buying activity at Citi Trends Inc provides a glimpse into the actions of significant shareholders and may be a point of interest for current and potential investors.
InvestingPro Insights
As investors consider the recent insider buying at Citi Trends Inc (NASDAQ:CTRN), they may also find it valuable to examine some key metrics provided by InvestingPro. With a market capitalization of $225.59 million, Citi Trends is navigating a challenging retail landscape. The company's P/E ratio stands at -18.29, reflecting investor sentiment about its future earnings potential. The adjusted P/E ratio for the last twelve months as of Q4 2024 is slightly lower at -20.22, suggesting that the market has tempered its expectations for the company's profitability.
Revenue trends offer a mix of insights, with a slight quarter-over-quarter increase of 2.73%, yet a year-over-year decline of 5.92%. This indicates some recovery in the short term but a more concerning longer-term trend in sales performance. Investors should note that Citi Trends has experienced a significant EBITDA decline of 98.59% over the last twelve months as of Q4 2024, which could be a point of caution.
An InvestingPro Tip to consider is the high shareholder yield, which signals that Citi Trends is returning value to its shareholders. However, the company's stock price has been quite volatile, with a one-month total return of -13.54%, which could be a concern for risk-averse investors. Additionally, analysts have revised their earnings expectations downwards for the upcoming period, and the stock is trading at a high EBITDA valuation multiple. This combination of factors may influence investment decisions.
For those interested in a deeper analysis, there are additional InvestingPro Tips available to help evaluate Citi Trends' financial health and future prospects. To access these insights and more, investors can visit https://www.investing.com/pro/CTRN and use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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