Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, urban fashion and accessories retailer Citi Trends
With that in mind, let's take a closer look at Citi Trends' business and see what CAPS investors are saying about the stock right now.
Citi Trends facts
|Headquarters (founded)||Savannah, Ga. (1946)|
|Market Cap||$249.5 million|
|Trailing-12-Month Revenue||$630.3 million|
CEO R. David Alexander Jr. (since 2009)
CFO Bruce Smith (since 2007)
|Return on Equity (average, past 3 years)||12.1%|
|Cash/Debt||$76.85 million / $0|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 85% of the 245 members who have rated Citi Trends believe the stock will outperform the S&P 500 going forward. These bulls include All-Stars tenmiles and TSIF, both of whom are ranked in the top 0.1% of our community.
Just last week , tenmiles tapped Citi Trends' recent slide as a possible bargain opportunity: "Likely long term value around $17 for this debt free retailer with almost 30% of market cap in cash -- potential free takeover 'option' given from these levels."
In fact, Citi Trends currently sports a cheapish price-to-book ratio of 1.1. That represents a clear discount to giant competitors Target (2.2), TJX (6.6), and Wal-Mart (2.9).
Citi Trends is at a new two year low and near peak recession prices. Near book, increasing stores. ... I agree this market niche has been hard hit the last two years. Cash on hand is excellent. Accounts Payable is large, but typical for a retailer carrying inventory. Recent downgrades should have helped put a floor on this one. ... Agree also with Tenmiles that with no debt, this could be primed for a takeover. A possible takeover is not an investment thesis, but could help minimize risk.
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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of Citi Trends and Wal-Mart. Motley Fool newsletter services have recommended buying shares of and creating a diagonal call position in Wal-Mart. Try any of our Foolish newsletter services free for 30 days.