CTRN - Citi Trends sustains slide after surprise quarterly loss slashed forecast

Citi Trends ( NASDAQ: CTRN ) stock continued to fall on Thursday, extending losses to over 30% from its mid-August peak.

The slump in shares has been led by an over 20% drop in just the past two days after the company posted weak Q2 results that included a surprise EPS loss as cost pressures mounted. Moving forward, management slashed full-year guidance as inflation-addled customers are expected to further tighten their belts

“The first half of 2022 was a challenging period as our customers, particularly those in the lowest income bracket, were under extraordinary pressure from widespread inflation, reducing their visits to stores for discretionary apparel and accessory purchases,” CEO David Makuen said. “It’s difficult to predict when this slower demand cycle will abate, therefore, we have revised our outlook for fiscal 2022 and have made it our number one priority to lower our SG&A expenses to align with a lower sales expectation.”

Cost-cutting measures include a 10% headcount reduction and the announcement of cuts to capital expenditures.

Shares fell 5.48% shortly after Thursday’s market open, adding to an 18.81% drop on Wednesday. Shares have declined over 70% since January.

Read the earnings call transcript .

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