CARTER'S INC (CRI) Stock Fundamental Analysis
NYSE:CRI - New York Stock Exchange, Inc. - US1462291097 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to CRI. CRI was compared to 48 industry peers in the Textiles, Apparel & Luxury Goods industry. CRI has an excellent financial health rating, but there are some minor concerns on its profitability. CRI has a bad growth rate and is valued cheaply. Finally CRI also has an excellent dividend rating. With these ratings, CRI could be worth investigating further for value and dividend investing!.
1. Profitability
1.1 Basic Checks
In the past year CRI was profitable.
CRI had a positive operating cash flow in the past year.
In the past 5 years CRI has always been profitable.
Each year in the past 5 years CRI had a positive operating cash flow.
1.2 Ratios
CRI's Return On Assets of 8.45% is fine compared to the rest of the industry. CRI outperforms 77.08% of its industry peers.
CRI has a Return On Equity of 23.26%. This is amongst the best in the industry. CRI outperforms 81.25% of its industry peers.
The Return On Invested Capital of CRI (12.72%) is better than 75.00% of its industry peers.
CRI had an Average Return On Invested Capital over the past 3 years of 13.75%. This is above the industry average of 11.45%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.45% | ||
| ROE | 23.26% | ||
| ROIC | 12.72% |
ROA(3y)9.05%
ROA(5y)8.18%
ROE(3y)26.4%
ROE(5y)25.22%
ROIC(3y)13.75%
ROIC(5y)13.22%
1.3 Margins
The Profit Margin of CRI (5.67%) is better than 64.58% of its industry peers.
In the last couple of years the Profit Margin of CRI has declined.
CRI's Operating Margin of 8.95% is fine compared to the rest of the industry. CRI outperforms 60.42% of its industry peers.
In the last couple of years the Operating Margin of CRI has declined.
CRI has a Gross Margin of 47.68%. This is comparable to the rest of the industry: CRI outperforms 41.67% of its industry peers.
In the last couple of years the Gross Margin of CRI has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.95% | ||
| PM (TTM) | 5.67% | ||
| GM | 47.68% |
OM growth 3Y-11.06%
OM growth 5Y-2.63%
PM growth 3Y-12.75%
PM growth 5Y-2.95%
GM growth 3Y0.38%
GM growth 5Y2.29%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so CRI is still creating some value.
Compared to 1 year ago, CRI has less shares outstanding
Compared to 5 years ago, CRI has less shares outstanding
CRI has a better debt/assets ratio than last year.
2.2 Solvency
CRI has an Altman-Z score of 3.26. This indicates that CRI is financially healthy and has little risk of bankruptcy at the moment.
CRI has a better Altman-Z score (3.26) than 62.50% of its industry peers.
The Debt to FCF ratio of CRI is 2.25, which is a good value as it means it would take CRI, 2.25 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.25, CRI is in the better half of the industry, outperforming 70.83% of the companies in the same industry.
CRI has a Debt/Equity ratio of 0.59. This is a neutral value indicating CRI is somewhat dependend on debt financing.
CRI has a worse Debt to Equity ratio (0.59) than 64.58% of its industry peers.
Even though the debt/equity ratio score it not favorable for CRI, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 2.25 | ||
| Altman-Z | 3.26 |
ROIC/WACC1.53
WACC8.32%
2.3 Liquidity
A Current Ratio of 2.56 indicates that CRI has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 2.56, CRI is in the better half of the industry, outperforming 64.58% of the companies in the same industry.
CRI has a Quick Ratio of 1.40. This is a normal value and indicates that CRI is financially healthy and should not expect problems in meeting its short term obligations.
CRI has a Quick ratio of 1.40. This is comparable to the rest of the industry: CRI outperforms 58.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.56 | ||
| Quick Ratio | 1.4 |
3. Growth
3.1 Past
The earnings per share for CRI have decreased by -9.39% in the last year.
The Earnings Per Share has been decreasing by -1.36% on average over the past years.
The Revenue has decreased by -3.69% in the past year.
The Revenue has been decreasing by -4.17% on average over the past years.
EPS 1Y (TTM)-9.39%
EPS 3Y-8.37%
EPS 5Y-1.36%
EPS Q2Q%-36.54%
Revenue 1Y (TTM)-3.69%
Revenue growth 3Y-6.56%
Revenue growth 5Y-4.17%
Sales Q2Q%-4.79%
3.2 Future
The Earnings Per Share is expected to decrease by -24.22% on average over the next years. This is quite bad
CRI is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.73% yearly.
EPS Next Y-43.8%
EPS Next 2Y-33.74%
EPS Next 3Y-24.22%
EPS Next 5YN/A
Revenue Next Year-1.23%
Revenue Next 2Y-1.02%
Revenue Next 3Y-0.73%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 5.60, the valuation of CRI can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of CRI indicates a rather cheap valuation: CRI is cheaper than 95.83% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of CRI to the average of the S&P500 Index (27.21), we can say CRI is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 11.95, the valuation of CRI can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CRI indicates a somewhat cheap valuation: CRI is cheaper than 77.08% of the companies listed in the same industry.
CRI is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 21.70, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.6 | ||
| Fwd PE | 11.95 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CRI indicates a rather cheap valuation: CRI is cheaper than 95.83% of the companies listed in the same industry.
93.75% of the companies in the same industry are more expensive than CRI, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 5.25 | ||
| EV/EBITDA | 3.64 |
4.3 Compensation for Growth
CRI has a very decent profitability rating, which may justify a higher PE ratio.
A cheap valuation may be justified as CRI's earnings are expected to decrease with -24.22% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-33.74%
EPS Next 3Y-24.22%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 8.68%, CRI is a good candidate for dividend investing.
CRI's Dividend Yield is rather good when compared to the industry average which is at 3.85. CRI pays more dividend than 95.83% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.42, CRI pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.68% |
5.2 History
On average, the dividend of CRI grows each year by 16.75%, which is quite nice.
CRI has been paying a dividend for at least 10 years, so it has a reliable track record.
CRI has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)16.75%
Div Incr Years1
Div Non Decr Years4
5.3 Sustainability
58.78% of the earnings are spent on dividend by CRI. This is a bit on the high side, but may be sustainable.
CRI's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP58.78%
EPS Next 2Y-33.74%
EPS Next 3Y-24.22%
31.85
+1.72 (+5.71%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryTextiles, Apparel & Luxury Goods
Earnings (Last)
Earnings (Next)
Inst Owners116.39%
Inst Owner Change-3.13%
Ins Owners2.6%
Ins Owner Change18.56%
Market Cap1.16B
Analysts47.14
Price Target30.19 (-5.21%)
Short Float %12.78%
Short Ratio2.71
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.68% |
Yearly Dividend3.2
Dividend Growth(5Y)16.75%
DP58.78%
Div Incr Years1
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)28.6%
Min EPS beat(2)23.39%
Max EPS beat(2)33.81%
EPS beat(4)4
Avg EPS beat(4)32.42%
Min EPS beat(4)19.02%
Max EPS beat(4)53.46%
EPS beat(8)8
Avg EPS beat(8)25.48%
EPS beat(12)10
Avg EPS beat(12)23.14%
EPS beat(16)14
Avg EPS beat(16)25.97%
Revenue beat(2)1
Avg Revenue beat(2)0.79%
Min Revenue beat(2)-0.04%
Max Revenue beat(2)1.63%
Revenue beat(4)1
Avg Revenue beat(4)-0.17%
Min Revenue beat(4)-1.64%
Max Revenue beat(4)1.63%
Revenue beat(8)2
Avg Revenue beat(8)-0.3%
Revenue beat(12)4
Avg Revenue beat(12)-0.3%
Revenue beat(16)7
Avg Revenue beat(16)-0.21%
PT rev (1m)2.07%
PT rev (3m)-35.3%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.22%
EPS NY rev (1m)2.35%
EPS NY rev (3m)-11.63%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.47%
Revenue NY rev (1m)0.39%
Revenue NY rev (3m)-0.88%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.6 | ||
| Fwd PE | 11.95 | ||
| P/S | 0.33 | ||
| P/FCF | 5.25 | ||
| P/OCF | 4.21 | ||
| P/B | 1.37 | ||
| P/tB | 3.33 | ||
| EV/EBITDA | 3.64 |
EPS(TTM)5.69
EY17.86%
EPS(NY)2.66
Fwd EY8.37%
FCF(TTM)6.07
FCFY19.06%
OCF(TTM)7.57
OCFY23.75%
SpS95.33
BVpS23.25
TBVpS9.57
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.45% | ||
| ROE | 23.26% | ||
| ROCE | 16.17% | ||
| ROIC | 12.72% | ||
| ROICexc | 15.26% | ||
| ROICexgc | 22.16% | ||
| OM | 8.95% | ||
| PM (TTM) | 5.67% | ||
| GM | 47.68% | ||
| FCFM | 6.37% |
ROA(3y)9.05%
ROA(5y)8.18%
ROE(3y)26.4%
ROE(5y)25.22%
ROIC(3y)13.75%
ROIC(5y)13.22%
ROICexc(3y)16.52%
ROICexc(5y)18.31%
ROICexgc(3y)24.79%
ROICexgc(5y)28.26%
ROCE(3y)17.48%
ROCE(5y)16.81%
ROICexcg growth 3Y-19.15%
ROICexcg growth 5Y0.36%
ROICexc growth 3Y-17.36%
ROICexc growth 5Y-0.7%
OM growth 3Y-11.06%
OM growth 5Y-2.63%
PM growth 3Y-12.75%
PM growth 5Y-2.95%
GM growth 3Y0.38%
GM growth 5Y2.29%
F-Score7
Asset Turnover1.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.59 | ||
| Debt/FCF | 2.25 | ||
| Debt/EBITDA | 1.36 | ||
| Cap/Depr | 96.71% | ||
| Cap/Sales | 1.57% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 75.08% | ||
| Profit Quality | 112.24% | ||
| Current Ratio | 2.56 | ||
| Quick Ratio | 1.4 | ||
| Altman-Z | 3.26 |
F-Score7
WACC8.32%
ROIC/WACC1.53
Cap/Depr(3y)84.08%
Cap/Depr(5y)65.4%
Cap/Sales(3y)1.75%
Cap/Sales(5y)1.49%
Profit Quality(3y)119.52%
Profit Quality(5y)187.79%
High Growth Momentum
Growth
EPS 1Y (TTM)-9.39%
EPS 3Y-8.37%
EPS 5Y-1.36%
EPS Q2Q%-36.54%
EPS Next Y-43.8%
EPS Next 2Y-33.74%
EPS Next 3Y-24.22%
EPS Next 5YN/A
Revenue 1Y (TTM)-3.69%
Revenue growth 3Y-6.56%
Revenue growth 5Y-4.17%
Sales Q2Q%-4.79%
Revenue Next Year-1.23%
Revenue Next 2Y-1.02%
Revenue Next 3Y-0.73%
Revenue Next 5YN/A
EBIT growth 1Y-17.87%
EBIT growth 3Y-16.9%
EBIT growth 5Y-6.69%
EBIT Next Year-8.9%
EBIT Next 3Y-8.38%
EBIT Next 5YN/A
FCF growth 1Y-10.76%
FCF growth 3Y1.66%
FCF growth 5Y-5.73%
OCF growth 1Y-6.35%
OCF growth 3Y3.65%
OCF growth 5Y-5.05%