Shares of Citi Trends Inc. CTRN sank 5.9% toward a four-month low in premarket trading Tuesday, after the discount apparel and accessories retailer for African American and multicultural families provided a downbeat sales outlook, while beating fourth-quarter results beat expectations. The company expects first-quarter sales to decline in the low double-digit percentage range, while the FactSet sales consensus of $212.2 million implies a 1.9% increase, as the macroeconomic environment keeps pressure on low income families, which is the bulk of its customer base. “Our customers are expected to remain under pressure through the first half of 2023, impacted by ongoing inflationary factors, in addition to the reduction in SNAP benefits and lower tax refunds,” said Chief Executive David Makuen. “As a result, our first quarter is off to a slow start.” For the fourth quarter, net income fell to $6.6 million, or 81 cents a share, from $9.8 million, or $1.16 a share, in the year-ago period. Excluding nonrecurring items, earnings per share of 83 cents topped the FactSet consensus of 81 cents. Sales fell 13.1% to $209.5 million, but was above the FactSet consensus of $208.8 million. The stock has tumbled 15.0% over the past three months through Monday, while the S&P 500 SPX has gained 1.9%.
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