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Reitmans (Canada) Class A (TSE:RET.A)
:RET.A
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Reitmans (Canada)
(OTC:RET.A)
Rating:61Neutral
Price Target:
C$2.00
▼(-0.50%Downside)
Reitmans (Canada) (RET.A) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$100.58M
Dividend YieldN/A
Average Volume (3M)22.64K
Price to Earnings (P/E)26.9
Beta (1Y)0.66
Revenue Growth-3.33%
EPS Growth-78.69%
CountryCA
Employees2,621
SectorConsumer Cyclical
Sector Strength71
IndustryApparel - Retail
Share Statistics
EPS (TTM)-0.20
Shares Outstanding35,998,790
10 Day Avg. Volume5,035
30 Day Avg. Volume22,635
Financial Highlights & Ratios
PEG Ratio-0.41
Price to Book (P/B)0.36
Price to Sales (P/S)0.00
P/FCF Ratio4.33
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$2.00Price Target Upside-0.51% Downside
Rating ConsensusHold
Number of Analyst Covering0
Reitmans (Canada) Business Overview & Revenue Model
Company DescriptionReitmans (Canada) Limited is a prominent Canadian retailer specializing in women's apparel. Founded in 1926, the company operates several brands, including Reitmans, Penningtons, and RW&CO., each catering to different customer segments within the women's fashion market. Reitmans is known for offering a wide range of high-quality clothing and accessories that blend style and comfort, targeting various age groups and body types.
How the Company Makes MoneyReitmans (Canada) Limited generates revenue primarily through the sale of women's apparel and accessories across its retail brands. The company operates brick-and-mortar stores across Canada, providing a physical shopping experience, while also expanding its e-commerce platforms to capture online sales. Key revenue streams include the direct sale of clothing items such as tops, bottoms, dresses, and outerwear, as well as accessories like jewelry and handbags. Significant factors contributing to its earnings include strategic brand positioning, a focus on customer service, and the ability to adapt to fashion trends. The company may engage in partnerships with designers or other fashion entities to enhance its product offerings, although specific partnerships are not detailed.
Reitmans (Canada) Earnings Call Summary
Earnings Call Date:Jun 17, 2025
(Q3-2025)
| % Change Since: -10.67%|
Next Earnings Date:Sep 18, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive and negative aspects. While the company showed improvements in gross margin, financial stability, and store expansion, it faced challenges with declining net revenue, comparable sales, EBITDA, and net earnings. The strategic focus on long-term growth and operational improvements indicates potential for future recovery.Q3-2025 Updates
Positive Updates
Improved Gross Margin
The company achieved a 166 basis point improvement in gross margin, increasing from 55.6% to 57.3% year-over-year, due to strong inventory management and reduced promotional activities.
Strong Financial Position
Reitmans ended the quarter with $123.1 million in cash, $141.3 million in inventory, and zero debt, maintaining a completely undrawn $150 million revolving credit facility.
Successful Store Openings
New RW&Co. store opened in Mirabel Premium Outlet, Quebec, and two new PENN stores opened in Avalon Mall, St. John's, and Durham Center, Ajax.
Growth in Menswear and Loyalty Programs
Continued strong growth in menswear for RW&Co. and positive customer and loyalty performance indicators for the company.
Negative Updates
Decline in Net Revenue
Net revenues decreased by 2.9% from $193.4 million to $187.7 million, attributed to lower store count and delayed seasonal purchases due to warmer weather.
Reduced Comparable Sales
Comparable sales fell by 1.9%, primarily due to lower e-commerce traffic, though this was partially offset by increased sales per transaction.
Decrease in Adjusted EBITDA
Adjusted EBITDA dropped from $9.5 million to $3.8 million, largely due to a $3.2 million increase in SG&A expenses and higher foreign exchange losses.
Decrease in Net Earnings
Net earnings decreased from $5.3 million ($0.11 per share) to $2.1 million ($0.04 per share) year-over-year.
Company Guidance
During Reitmans Canada Limited's fiscal 2025 third-quarter earnings call, management provided detailed guidance on several metrics. Net revenues were reported at $187.7 million, a decrease of 2.9% from the previous year due to a lower store count and delayed customer purchases caused by warmer-than-normal weather. Comparable sales dipped by 1.9%, largely impacted by reduced e-commerce traffic. Despite this, gross profit remained stable at $107.6 million, with a notable improvement in gross margin by 166 basis points to 57.3%. Adjusted EBITDA for the quarter was $3.8 million, down from $9.5 million the previous year, primarily due to increased selling, general and administrative expenses and a rise in foreign exchange loss. The company ended the quarter with a strong cash position of $123.1 million and zero debt, while capital expenditures for the fiscal year are projected at $31 million, with $20.1 million spent in the first nine months.Reitmans (Canada) Financial Statement Overview
Summary
Reitmans (Canada) shows strong gross profit margins and a stable balance sheet with moderate leverage. However, challenges with net profit margins, revenue growth, and volatility in cash flows highlight potential risks. Improving operational efficiency and revenue growth is essential for sustaining financial health.Income Statement
The company shows a mixed performance in its income statement. The TTM gross profit margin is strong at approximately 56%, indicating efficient cost management. However, the net profit margin is low at around 0.47%, reflecting challenges in translating revenue to net income. Revenue has fluctuated, showing a decline over the past year, which is concerning. EBIT and EBITDA margins indicate weak operational efficiency, although there is a positive trend from the previous year.65
Positive
Balance Sheet
The balance sheet reflects moderate financial stability. The debt-to-equity ratio is approximately 0.55, which is manageable. The equity ratio stands at about 55%, suggesting a solid equity base relative to assets. Return on equity is low, highlighting inefficiencies in generating returns from shareholders' equity. Overall, the company maintains a reasonable balance between debt and equity, but there is room for improvement in asset utilization.70
Positive
Cash Flow
Cash flow analysis reveals a stable cash generation capability. The TTM operating cash flow to net income ratio is robust, indicating good cash conversion. However, free cash flow growth is inconsistent, with a recent decline. The free cash flow to net income ratio is favorable, suggesting effective management of capital expenditures. While cash flows are generally positive, volatility in free cash flow warrants caution.68
Positive
| Breakdown | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 773.80M | 794.69M | 661.95M | 533.36M | 869.50M |
| Gross Profit | 435.04M | 431.00M | 353.17M | 246.25M | 444.39M |
| EBITDA | 78.44M | 76.22M | 94.70M | 194.46M | -41.58M |
| Net Income | 12.14M | 14.81M | 158.26M | -172.22M | -87.43M |
Balance Sheet | |||||
| Total Assets | 574.09M | 490.75M | 314.27M | 397.23M | 560.17M |
| Cash, Cash Equivalents and Short-Term Investments | 158.12M | 116.65M | 25.50M | 77.92M | 89.41M |
| Total Debt | 155.40M | 137.59M | 81.94M | 123.22M | 213.87M |
| Total Liabilities | 277.66M | 211.73M | 130.45M | 375.55M | 366.35M |
| Stockholders Equity | 296.43M | 279.02M | 183.83M | 21.68M | 193.82M |
Cash Flow | |||||
| Free Cash Flow | 73.06M | 51.83M | -35.38M | 34.03M | 53.70M |
| Operating Cash Flow | 104.26M | 69.53M | -24.73M | 40.20M | 77.18M |
| Investing Cash Flow | -31.19M | -17.70M | -15.22M | -6.16M | 17.95M |
| Financing Cash Flow | -40.03M | -39.90M | -9.19M | -46.82M | -121.78M |
Reitmans (Canada) Technical Analysis
Neutral
2.01
Price Trends
2.11
Negative
2.12
Negative
2.31
Negative
Market Momentum
-0.02
Negative
51.60
Neutral
72.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RET.A, the sentiment is Neutral. The current price of 2.01 is above the 20-day moving average (MA) of 1.98, below the 50-day MA of 2.11, and below the 200-day MA of 2.31, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 51.60 is Neutral, neither overbought nor oversold. The STOCH value of 72.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:RET.A.
Reitmans (Canada) Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $7.14B | 36.25 | 23.27% | ― | 22.57% | 197.68% | |
77 Outperform | $1.93B | 20.39 | 19.34% | ― | 1.20% | 60.11% | |
72 Outperform | C$51.53B | 42.33 | 138.71% | 0.21% | 9.20% | 18.11% | |
63 Neutral | $17.32B | 10.90 | -7.25% | 3.10% | 1.66% | -25.40% | |
61 Neutral | C$100.58M | 26.94 | 1.49% | ― | -3.33% | -78.69% | |
61 Neutral | C$126.70M | 30.45 | -19.69% | ― | 2.63% | -3376.73% | |
57 Neutral | $5.14B | 19.66 | 26.57% | 1.21% | -22.34% | -110.04% |
* Consumer Cyclical Sector Average
Performance Comparison
TSE:RET.A
Reitmans (Canada)
2.01
-0.26
-11.45%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.