Latest Ratios: P/E Ratio -10.7x · EV/EBITDA N/A · ROE -3.7%. (1996–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $59M | $58M | $64M | $131M | $198M | $349M | $256M | $381M | $368M | $298M | $697M |
| Enterprise Value | $190M | $189M | $190M | $260M | $353M | $513M | $445M | $579M | $343M | $220M | $650M |
| P/E Ratio → | -10.68 | — | — | — | 6626.67 | 10.01 | — | 10.99 | 12.07 | 34.94 | 14.76 |
| P/S Ratio | 0.09 | 0.09 | 0.10 | 0.19 | 0.26 | 0.45 | 0.45 | 0.46 | 0.44 | 0.35 | 0.73 |
| P/B Ratio | 0.40 | 0.37 | 0.40 | 0.68 | 0.87 | 1.37 | 1.04 | 1.20 | 1.16 | 0.91 | 1.82 |
| P/FCF | — | — | — | — | — | 6.26 | — | 8.44 | 6.58 | 11.99 | 15.55 |
| P/OCF | — | — | — | 274.79 | 14.82 | 5.83 | — | 7.13 | 6.10 | 8.29 | 9.66 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 0.29 | 0.29 | 0.37 | 0.46 | 0.67 | 0.77 | 0.70 | 0.41 | 0.26 | 0.68 |
| EV / EBITDA | — | — | — | — | 44.56 | 10.24 | — | 10.97 | 7.43 | 5.75 | 8.27 |
| EV / EBIT | — | — | — | — | 190.02 | 13.15 | — | 13.40 | 10.38 | 13.80 | 13.23 |
| EV / FCF | — | — | — | — | — | 9.22 | — | 12.85 | 6.14 | 8.85 | 14.49 |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 32.5% | 32.5% | 31.3% | 33.0% | 31.4% | 39.5% | 22.1% | 36.5% | 35.0% | 32.6% | 34.7% |
| Operating Margin | -2.2% | -2.2% | -4.2% | -2.4% | -0.4% | 4.9% | -11.4% | 4.5% | 3.6% | 2.2% | 5.8% |
| Net Profit Margin | -0.9% | -0.9% | -2.9% | -3.2% | 0.0% | 4.5% | -7.9% | 4.2% | 3.6% | 1.0% | 4.8% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | -3.7% | -3.7% | -10.5% | -10.8% | 0.0% | 13.9% | -16.1% | 10.9% | 9.2% | 2.4% | 11.6% |
| ROA | -1.4% | -1.4% | -4.0% | -4.3% | 0.0% | 5.7% | -7.1% | 5.8% | 5.8% | 1.5% | 7.4% |
| ROIC | -3.7% | -3.7% | -6.7% | -3.6% | -0.6% | 6.6% | -10.3% | 6.9% | 8.2% | 4.8% | 12.3% |
| ROCE | -5.4% | -5.4% | -9.6% | -5.3% | -0.9% | 9.5% | -14.6% | 8.9% | 8.1% | 4.6% | 12.6% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.96 | 0.96 | 0.90 | 0.80 | 0.77 | 0.73 | 0.84 | 0.66 | — | — | — |
| Debt / EBITDA | — | — | — | — | 22.07 | 3.68 | — | 3.98 | — | — | — |
| Net Debt / Equity | — | 0.83 | 0.77 | 0.67 | 0.68 | 0.65 | 0.77 | 0.63 | -0.08 | -0.24 | -0.12 |
| Net Debt / EBITDA | — | — | — | — | 19.54 | 3.28 | — | 3.76 | -0.53 | -2.04 | -0.60 |
| Debt / FCF | — | — | — | — | — | 2.96 | — | 4.40 | -0.44 | -3.14 | -1.05 |
| Interest Coverage | — | — | -272.10 | -393.31 | 21.34 | 542.18 | -388.34 | 1490.90 | 344.28 | 140.11 | 279.06 |
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.24 | 1.24 | 1.19 | 1.29 | 1.37 | 1.46 | 1.60 | 1.82 | 2.61 | 2.68 | 2.58 |
| Quick Ratio | 0.70 | 0.70 | 0.60 | 0.77 | 0.82 | 0.95 | 1.13 | 1.24 | 1.77 | 1.80 | 1.73 |
| Cash Ratio | 0.49 | 0.49 | 0.41 | 0.55 | 0.63 | 0.68 | 0.79 | 1.06 | 1.46 | 1.42 | 1.45 |
| Asset Turnover | — | 1.55 | 1.44 | 1.45 | 1.37 | 1.21 | 0.97 | 1.20 | 1.66 | 1.65 | 1.58 |
| Inventory Turnover | 5.28 | 5.28 | 4.03 | 4.81 | 4.65 | 3.73 | 5.32 | 4.55 | 4.51 | 4.71 | 4.29 |
| Days Sales Outstanding | — | 14.21 | 13.78 | 15.34 | 12.74 | 26.48 | 33.47 | 11.54 | 12.38 | 12.03 | 11.58 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | — | — | 16.3% | 10.6% | 7.3% | 2.9% | 3.1% | 8.6% | 8.9% | 11.3% | 5.1% |
| Payout Ratio | — | — | — | — | 35046.3% | 28.6% | — | 94.2% | 110.1% | 403.1% | 76.6% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | — | — | — | — | 0.0% | 10.0% | — | 9.1% | 8.3% | 2.9% | 6.8% |
| FCF Yield | — | — | — | — | — | 16.0% | — | 11.8% | 15.2% | 8.3% | 6.4% |
| Buyback Yield | 1.7% | 1.7% | 6.0% | 2.0% | 7.7% | 6.3% | 7.7% | 2.5% | 3.6% | 13.0% | 6.1% |
| Total Shareholder Yield | 1.7% | 1.7% | 22.3% | 12.6% | 14.9% | 9.2% | 10.8% | 11.1% | 12.5% | 24.3% | 11.2% |
| Shares Outstanding | — | $19M | $19M | $19M | $20M | $21M | $23M | $24M | $25M | $25M | $27M |
Persistent negative operating margins
According to current market data, CATO trades at a price-to-sales multiple of 0.09, which, when combined with a negative TTM P/E ratio of -10.77, suggests that investors are pricing the company closer to a liquidation scenario than a viable, long-term retail going concern.
The absence of a forward P/E or EV/EBITDA multiple indicates that the market lacks confidence in the company's ability to return to profitability in the near term. This valuation level implies that the market is heavily discounting the company's physical asset base, likely due to the persistent inability to convert revenue into positive operating income.
Based on reported financial statements, CATO's ROIC has fluctuated between a peak of 2.3% and a trough of -4.7% over the last ten quarters, signaling that the company is currently failing to generate returns that exceed its cost of capital, thereby destroying shareholder value.
The volatility in ROIC is primarily driven by the company's inability to maintain stable operating margins across its extensive store fleet. This trend suggests that the current capital allocation strategy is failing to improve operational efficiency, as the company continues to deploy resources into a model that is not currently self-sustaining.
As reported in recent quarterly filings, the company's cash conversion cycle has remained elevated, with days inventory outstanding peaking at 91 days in 2025Q1, which highlights significant inefficiencies in matching inventory procurement with the actual pace of consumer demand in rural markets.
The inability to optimize the cash conversion cycle suggests that capital is being trapped in slow-moving inventory, which necessitates frequent markdowns and further compresses gross margins. Investors should monitor whether management can rationalize these working capital levels, as the current trend indicates a persistent drag on liquidity.
Based on the most recent quarterly balance sheet, CATO's current ratio of 1.29 and quick ratio of 0.74 indicate a tightening liquidity position, which may leave the company vulnerable to sudden shifts in consumer spending or unexpected increases in operational costs within its rural footprint.
The reliance on inventory to meet current obligations, as evidenced by the gap between the current and quick ratios, suggests that the company's liquidity is highly sensitive to the marketability of its apparel. If the company cannot improve its inventory turnover, it may face increased pressure to utilize its limited cash reserves to fund ongoing operations.
While analysts often use a price-to-book ratio of 0.40 to argue that CATO is undervalued, this metric is frequently misapplied because it ignores the potential for significant impairment charges on the company's extensive, specialized, and geographically concentrated physical store assets in rural markets.
Relying on book value in a retail context can be misleading when the underlying assets are tied to underperforming physical locations that may not be easily repurposed or liquidated. A more appropriate focus would be on the company's ability to generate free cash flow, as the book value may significantly overstate the true economic worth of the store fleet.
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Quick answers to the most common questions about buying CATO stock.
The Cato Corporation's current P/E ratio is -10.7x. The historical average is 14.5x.
The Cato Corporation's return on equity (ROE) is -3.7%. The historical average is 10.9%.
Based on historical data, The Cato Corporation is trading at a P/E of -10.7x. Compare with industry peers and growth rates for a complete picture.
The Cato Corporation has 32.5% gross margin and -2.2% operating margin.