Citi Trends (NASDAQ: CTRN) and Buckle, Inc. (The) (NYSE:BKE) are both small-cap retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, dividends, earnings, profitability, valuation, institutional ownership and risk.

Dividends

Citi Trends pays an annual dividend of $0.32 per share and has a dividend yield of 1.5%. Buckle, Inc. (The) pays an annual dividend of $1.00 per share and has a dividend yield of 6.2%. Citi Trends pays out 35.2% of its earnings in the form of a dividend. Buckle, Inc. (The) pays out 55.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Buckle, Inc. (The) has raised its dividend for 3 consecutive years. Buckle, Inc. (The) is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

90.8% of Citi Trends shares are held by institutional investors. Comparatively, 59.5% of Buckle, Inc. (The) shares are held by institutional investors. 4.6% of Citi Trends shares are held by insiders. Comparatively, 41.7% of Buckle, Inc. (The) shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares Citi Trends and Buckle, Inc. (The)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Citi Trends 1.88% 6.93% 4.69%
Buckle, Inc. (The) 9.40% 19.96% 15.04%

Analyst Recommendations

This is a summary of current ratings for Citi Trends and Buckle, Inc. (The), as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Citi Trends 0 0 0 0 N/A
Buckle, Inc. (The) 1 0 0 0 1.00

Buckle, Inc. (The) has a consensus target price of $13.00, suggesting a potential downside of 19.25%. Given Buckle, Inc. (The)’s higher possible upside, analysts plainly believe Buckle, Inc. (The) is more favorable than Citi Trends.

Volatility & Risk

Citi Trends has a beta of 0.42, meaning that its share price is 58% less volatile than the S&P 500. Comparatively, Buckle, Inc. (The) has a beta of 0.92, meaning that its share price is 8% less volatile than the S&P 500.

Valuation and Earnings

This table compares Citi Trends and Buckle, Inc. (The)’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Citi Trends $712.38 million 0.42 $35.16 million $0.91 23.00
Buckle, Inc. (The) $927.07 million 0.84 $167.12 million $1.80 8.94

Buckle, Inc. (The) has higher revenue and earnings than Citi Trends. Buckle, Inc. (The) is trading at a lower price-to-earnings ratio than Citi Trends, indicating that it is currently the more affordable of the two stocks.

Summary

Buckle, Inc. (The) beats Citi Trends on 12 of the 15 factors compared between the two stocks.

Citi Trends Company Profile

Citi Trends, Inc. is a retailer of urban fashion apparel and accessories. The Company’s segment is retail operations. The Company operates approximately 520 stores in both urban and rural markets in over 30 states. The Company offers products under its brands, such as Citi Steps and Red Ape. The Company’s merchandise includes apparel, accessories and home. Within apparel, the Company offers fashion sportswear for men, women and children, including offerings for newborns, infants, toddlers, boys and girls. Accessories include handbags, jewelry, footwear, belts, intimate apparel, scrubs and sleepwear. The Company’s home merchandise includes decorative home product, functional home product, beauty, books, toys and electronic accessories. The Company sources its merchandise from approximately 1,700 vendors, consisting of domestic manufacturers and importers.

Buckle, Inc. (The) Company Profile

The Buckle, Inc. is a retailer of casual apparel, footwear and accessories for young men and women. As of January 28, 2017, the Company operated 467 retail stores in 44 states throughout the United States under the names Buckle and The Buckle. The Company markets a selection of brand name casual apparel, including denims, other casual bottoms, tops, sportswear, outerwear, accessories and footwear. The Company provides customer services, such as free hemming, free gift-wrapping, easy layaways, the Buckle private label credit card, and a guest loyalty program. The Company offers denims from brands, such as Miss Me, Rock Revival, Big Star Vintage, Buffalo Jeans, KanCan, Flying Monkey and Levi’s. Its other brands include Hurley, Billabong, Affliction, American Fighter, Fast & Furious, Oakley, Fox, Puma, Obey, RVCA, Salvage, 7 Diamonds, Nixon, Amuse Society, Free People, White Crow, Corral, Reef, Kustom, Timberland, UGG, TOMS, SAXX, Stance, Lokai, Ray-Ban, and Fossil.

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