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Reitmans (Canada) Limited (TSE:RET)
:RET
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Reitmans (Canada) Limited
(RET)
69Neutral
Reitmans (Canada) Limited (RET) vs. S&P 500 (SPY)
Market Cap
C$111.23M
Dividend YieldN/A
Average Volume (3M)1.12K
Price to Earnings (P/E)7.2
Beta (1Y)0.26
Revenue Growth0.81%
EPS Growth-61.74%
CountryCA
Employees2,621
SectorReal Estate
Sector Strength62
IndustryRetail - Discretionary
Share Statistics
EPS (TTM)0.33
Shares Outstanding13,440,000
10 Day Avg. Volume970
30 Day Avg. Volume1,123
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.15
Price to Cash Flow (P/CF)1.80
P/FCF Ratio2.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Reitmans (Canada) Limited Business Overview & Revenue Model
Company DescriptionReitmans (Canada) Limited (RET) is a leading Canadian retailer specializing in women's fashion. The company operates a range of retail brands, including Reitmans, Penningtons, and RW&CO, each catering to different demographics and style preferences. With a focus on providing stylish, comfortable, and affordable clothing options, Reitmans offers a diverse array of products, from casual wear to professional attire and accessories, serving a broad customer base across Canada.
How the Company Makes MoneyReitmans (Canada) Limited generates revenue primarily through the sale of women's clothing and accessories via its retail stores and online platforms. The company operates a network of physical stores across Canada, which act as a significant sales channel. Additionally, their e-commerce platforms provide an avenue for online sales, expanding their reach beyond physical locations. Key revenue streams include direct sales from brick-and-mortar stores, online transactions, and seasonal promotions that drive customer engagement and sales volume. Reitmans also leverages brand differentiation by targeting various segments of the women's fashion market through its distinct brands, appealing to a wide range of customers. Partnerships with suppliers and effective inventory management practices also play a crucial role in maintaining profitability and optimizing product offerings.
Reitmans (Canada) Limited Financial Statement Overview
Summary
Reitmans (Canada) Limited demonstrates a solid financial position with stable profitability and effective cash flow management. While revenue growth is slow, the company maintains healthy margins and a strong equity base. Cash flow metrics are particularly strong, providing flexibility for future investments or debt servicing. Overall, the company is in a stable financial state with opportunities for growth and improvement in profitability.Income Statement
Reitmans (Canada) Limited shows a stable gross profit margin of 54.5% for TTM, indicating strong cost management. The net profit margin is modest at 2.06%, showing a slight improvement over the previous year. Revenue growth is positive but slow, with a marginal decline of 0.6% from the previous year. EBIT and EBITDA margins are healthy at 3.22% and 10.6% respectively, suggesting operational efficiency and profitability.72
Positive
Balance Sheet
The company maintains a solid equity base with an equity ratio of 55.5%, indicating strong financial stability. The debt-to-equity ratio is 0.50, which is reasonable and suggests manageable leverage. Return on equity stands at 5.5%, reflecting moderate returns on shareholder investment.65
Positive
Cash Flow
Reitmans exhibits strong cash generation with a significant operating cash flow to net income ratio of 5.75, indicating effective conversion of earnings into cash. The free cash flow grew by 24.9%, showcasing improved cash availability for reinvestment and debt reduction. The free cash flow to net income ratio is robust at 3.97, highlighting strong cash profitability.78
Positive
| Breakdown | |||||
| TTM | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 789.94M | 794.69M | 661.95M | 533.36M | 869.50M | 923.02M | Gross Profit |
| 430.27M | 431.00M | 353.17M | 246.25M | 444.39M | 509.51M | EBIT |
| 25.42M | 22.93M | 143.15M | -108.00M | -51.44M | 18.24M | EBITDA |
| 83.75M | 76.22M | 94.70M | 194.46M | -41.58M | 42.14M | Net Income Common Stockholders |
| 16.30M | 14.81M | 158.26M | -172.22M | -87.43M | 6.76M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 123.07M | 116.65M | 25.50M | 77.92M | 89.41M | 162.21M | Total Assets |
| 533.94M | 490.75M | 314.27M | 397.23M | 560.17M | 492.82M | Total Debt |
| 148.15M | 137.59M | 81.94M | 123.22M | 213.87M | 213.87M | Net Debt |
| 25.08M | 20.94M | 56.44M | 45.30M | 124.46M | 101.35M | Total Liabilities |
| 237.38M | 211.73M | 130.45M | 375.55M | 366.35M | 153.22M | Stockholders Equity |
| 296.56M | 279.02M | 183.83M | 21.68M | 193.82M | 339.60M |
| Cash Flow | Free Cash Flow | ||||
| 64.75M | 51.83M | -35.38M | 34.03M | 53.70M | 15.88M | Operating Cash Flow |
| 93.65M | 69.53M | -24.73M | 40.20M | 77.18M | 42.01M | Investing Cash Flow |
| -28.90M | -17.70M | -15.22M | -6.16M | 17.95M | -26.01M | Financing Cash Flow |
| -47.58M | -39.90M | -9.19M | -46.82M | -121.78M | -12.67M |
Reitmans (Canada) Limited Technical Analysis
Negative
2.31
Price Trends
2.54
Negative
2.65
Negative
2.67
Negative
Market Momentum
-0.05
Positive
44.11
Neutral
26.11
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RET, the sentiment is Negative. The current price of 2.31 is below the 20-day moving average (MA) of 2.44, below the 50-day MA of 2.54, and below the 200-day MA of 2.67, indicating a bearish trend. The MACD of -0.05 indicates Positive momentum. The RSI at 44.11 is Neutral, neither overbought nor oversold. The STOCH value of 26.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:RET.
Reitmans (Canada) Limited Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $9.74B | 18.71 | 23.48% | 1.85% | 4.03% | -16.63% | |
73 Outperform | $6.11B | 45.02 | 15.44% | ― | 10.36% | 41.78% | |
69 Neutral | C$111.23M | 7.16 | 5.64% | ― | 0.81% | -61.74% | |
67 Neutral | $1.16B | 16.02 | 15.82% | ― | 4.64% | 41.68% | |
66 Neutral | $8.51B | 9.32 | 15.17% | 4.91% | -1.79% | 318.70% | |
64 Neutral | C$94.04M | 32.47 | 1.62% | ― | -2.09% | 2551.85% | |
61 Neutral | $4.73B | 18.32 | -3.52% | 11.32% | 5.97% | -21.87% |
* Real Estate Sector Average
Performance Comparison
TSE:RET
Reitmans (Canada) Limited
2.36
-0.57
-19.45%
TSE:GIL
Gildan Activewear
64.12
14.74
29.85%
TSE:ATZ
Aritzia
53.07
15.84
42.55%
TSE:GOOS
Canada Goose Holdings
12.00
-4.72
-28.23%
TSE:CTC.A
Canadian Tire
149.41
20.96
16.32%
TSE:ROOT
Roots Corporation
2.32
-0.05
-2.11%
Reitmans (Canada) Limited Earnings Call Summary
Earnings Call Date: Dec 19, 2024 | % Change Since: -17.20% | Next Earnings Date: Apr 10, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook for Reitmans Canada Limited. While the company demonstrated strong financial management, resulting in improved gross margins and a robust cash position, there were notable challenges. These included a decrease in revenue and comparable sales, reduced EBITDA, and expressed shareholder concerns regarding governance. Despite positive operational progress and store expansion, these issues led to an overall cautious sentiment.Highlights
Gross Margin Improvement
Achieved a 166 basis point improvement in gross margin compared to a year ago, reaching 57.3% due to strong inventory management and reduced promotional activities.
Strong Financial Position
Ended the quarter with working capital of $172.9 million, a cash position of $123.1 million, and zero debt with an undrawn $150 million revolving credit facility.
Successful Marketing Campaigns
Strong results from ambassadors marketing campaign featuring notable figures, contributing to brand visibility and customer engagement.
Continued Store Expansion
Opened new RW&Co. store in Mirabel and two new PENN stores, expanding the store footprint and supporting growth in various regions.
Lowlights
Revenue Decline
Net revenues decreased by 2.9% to $187.7 million due to lower store count and customers delaying fall clothing purchases.
Decrease in Comparable Sales
Comparable sales for the quarter were down 1.9% mainly due to lower e-commerce traffic, despite increased sales per transaction.
Reduced EBITDA
Adjusted EBITDA decreased to $3.8 million from $9.5 million in the previous year, impacted by increased SG&A expenses and foreign exchange losses.
Shareholder Concerns
Shareholder dissatisfaction with governance and decision-making at board level, highlighting issues with minority shareholder oppression and lack of board independence.
Company Guidance
During Reitmans Canada Limited's Fiscal 2025 Third Quarter Earnings Call, management provided several key metrics and updates. The company reported a 2.9% decrease in net revenues, totaling $187.7 million, attributed to warmer-than-usual weather and a lower store count. Despite the decline in revenues, the gross margin improved by 166 basis points to 57.3%, aided by effective inventory management and reduced promotional activities. The adjusted EBITDA for the quarter was $3.8 million, down from $9.5 million the previous year, largely due to increased selling, general and administrative expenses and foreign exchange losses. Net earnings were $2.1 million or $0.04 per share, compared to $5.3 million or $0.11 per share a year ago. The company maintained a strong financial position with $123.1 million in cash and no debt. Reitmans also repurchased 91,100 shares during the quarter. Capital expenditures for the fiscal year are projected at $31 million, with $20.1 million spent in the first nine months. The company's focus remains on growth and modernization, including opening new stores and upgrading digital infrastructure.Reitmans (Canada) Limited Corporate Events
Reitmans Announces Retirement of CIO Gale Blank
Jan 14, 2025
Reitmans (Canada) Limited announced the retirement of their Chief Information Officer, Gale Blank, set for September 2025, after more than five years of service. Gale Blank has been praised for her role in establishing a strong technological foundation crucial for the company’s growth strategy. The company is now searching for a successor to continue driving strategic IT objectives that are central to Reitmans’ growth plans.
Reitmans Sees Revenue Dip Amid Weather Challenges
Dec 19, 2024
Reitmans (Canada) Limited reported a decrease in net revenues by 2.9% for the third quarter of fiscal 2025, attributed to fewer stores and warm autumn weather. Despite the revenue decline, the company improved its gross margin to 57.3% due to effective inventory control and reduced promotional activities.
Reitmans Appoints Caroline Goulian as CFO
Nov 4, 2024
Reitmans (Canada) Limited has appointed Caroline Goulian as the new Chief Financial Officer, succeeding Richard Wait, who will retire in April 2025 after a 40-year tenure. Goulian, who brings over 20 years of financial management experience, has been with RCL since 2020 and is expected to continue aligning finance functions with business priorities.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.