In a recent flurry of buying activity, Citi Trends Inc (NASDAQ:CTRN) witnessed significant insider purchases totaling approximately $802,000. The transactions, which took place between May 31 and June 4, 2024, involved prices ranging from $23.21 to $25.55 per share.
The buyers, investment entities associated with Pleasant Lake Partners, demonstrated their bullish stance on the apparel and accessory retailer. Pleasant Lake Onshore Feeder Fund LP, Fund 1 Investments, LLC, and Pleasant Lake Partners LLC, all under the umbrella of Pleasant Lake Partners, made notable purchases in a series of transactions. These entities are known to hold more than ten percent of Citi Trends' common stock, indicating a substantial interest in the company's performance.
The SEC Form 4 filings revealed the details of the purchases, which included acquiring 2,000 shares at $23.21 each, another 2,000 shares at $24.58, and 1,000 shares at $25.55, among others within the specified date range. Additional buys included 508 shares at $25.43, 18,000 shares at $24.85, 5,000 shares at $24.64, and 4,000 shares at $24.53. Following these transactions, the reported shares owned by the entities increased to 2,151,527.
The ownership nature of these shares is indirect, as noted in the SEC filings, with the footnote clarifying that 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, and Fund 1 Investments, LLC is the managing member of Pleasant Lake Partners LLC. The filings further state that each reporting person disclaims beneficial ownership of the reported shares except to the extent of their pecuniary interest.
This insider activity may be of interest to investors and market watchers, as insider purchases can be a sign of confidence in the company's future prospects. However, it is important for investors to consider the broader market context and other factors when evaluating the significance of insider transactions.
InvestingPro Insights
Amid the insider buying spree at Citi Trends Inc (NASDAQ:CTRN), the InvestingPro platform provides additional context that may be valuable for investors considering the company's stock. The recent purchases by entities associated with Pleasant Lake Partners are a bullish signal, yet it's worth noting the broader financial health and market performance of Citi Trends.
InvestingPro data shows that Citi Trends has a market capitalization of $210.43 million, reflecting the size of the company in the competitive retail market. Despite the positive insider trading activity, the company's P/E ratio stands at -16.9, indicating that the market currently does not expect earnings growth in the near term. Additionally, the company's revenue has seen a decline of 5.92% over the last twelve months as of Q4 2024, which may be a point of concern for potential investors.
Two InvestingPro Tips that stand out in relation to the article are the high shareholder yield and the volatility in stock price movements. The high shareholder yield suggests that investors might be getting a good return on their investment through a combination of dividends, buybacks, and debt reduction. However, the volatility in stock price movements, with a 21.55% decrease over the last three months, could indicate a higher risk profile that interested parties should consider.
For those looking to delve deeper into Citi Trends' financials and future outlook, InvestingPro offers additional tips. There are currently six more InvestingPro Tips available for Citi Trends, which can provide a more nuanced understanding of the company's financial position and market potential. To access these tips and gain a more comprehensive investment perspective, readers can use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at: https://www.investing.com/pro/CTRN.
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