4-Star Stocks Poised to Pop: Cato
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, women's apparel retailer Cato (NYS: CATO) has earned a respected four-star ranking.
With that in mind, let's take a closer look at Cato's business and see what CAPS investors are saying about the stock right now.
|Headquarters (founded)||Charlotte, N.C. (1946)|
|Market Cap||$800.0 million|
|Trailing-12-Month Revenue||$931.5 million|
|Management||Chairman/CEO John Derham Cato (since 1999)|
CFO John Howe (since 2008)
|Return on Capital (average, past 3 years)||17.9%|
|Cash/Debt||$240.7 million / $0|
|Competitors||Ascena Retail Group|
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 83% of the 95 members who have rated Cato believe the stock will outperform the S&P 500 going forward.
Even though the dividend yield is at 3.4%, their payout ratio based on earnings is only about 40%. The company has $240 million in cash and no debt. ...
2008 and 2009 were a little rough on the company and the company had to close quite a few stores. ... Since then, the company has stabilized a bit and seems to be back on track. The dividend will likely prevent a big drop in share price, but any news regarding growth could send this thing much higher, similar to what happened with Gap about 3 months ago.
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At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Cato. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.
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