Cato Corporation
NYSE: CATO · CONSUMER CYCLICAL · APPAREL RETAIL
Updated 2026-06-05
Cato Corporation (CATO) Stock Valuation Analysis
Fair value estimate, historical valuation range, and quality signals for CATO.
Valued
Valuation reasonably reflects current fundamentals. Limited margin of safety at these levels.
CATO historical valuation range
Where current P/E sits in CATO's own 5Y range.
CATO intrinsic value (DCF)
DCF-based fair value estimate vs current market price.
Intrinsic value calculated using discounted cash flow (DCF) model based on projected free cash flows, discount rate, and terminal growth assumptions. A positive margin of safety indicates the current price is below estimated fair value, providing a cushion against estimation error.
CATO valuation signals
Quick-read green flags, caution flags, and risks based on current metrics.
P/E Ratio — History
P/S Ratio — History
Current: 0.10x
Is CATO overvalued in 2026?
Cato Corporation (CATO) currently trades at $2.91 per share with a market capitalization of $65,465,000.00. Based on our multi-factor framework, the stock trades at a fair valuation with a Smart Value Score of 57/100. This score blends growth quality, financial health, and price attractiveness into a single institutional-grade read.
CATO currently has no meaningful P/E ratio, which typically signals that the company is unprofitable, near breakeven, or emerging from a loss-making period. With a P/S ratio of 0.1x, the market is valuing the company primarily on its revenue rather than its earnings.
Our discounted cash flow model estimates CATO's intrinsic value at $12.93 per share, against the current market price of $2.91. This implies a margin of safety of +76.64%. A meaningful cushion exists against model error, making this a reasonable risk-adjusted entry.
The Piotroski F-Score of 6/9 puts financial quality in a middling range, neither a standout strength nor an obvious red flag.
Bottom line: CATO trades at a fair valuation on our framework, with a Smart Value Score of 57/100. The valuation is defensible but offers no obvious bargain. Patience or a better entry price may reward disciplined buyers.
Frequently asked questions
Is CATO overvalued?
CATO scores 57/100 on our Smart Value Score (Grade C+), a mixed overall profile. The DCF also shows a positive margin of safety, so price and fundamentals line up reasonably well.
What is CATO's fair value?
Our DCF model estimates CATO's intrinsic value at $12.93 per share, versus the current price of $2.91, a margin of safety of +76.64%. Fair value is the present value of the cash flows we project the business to produce, so a price below it means the market is pricing the stock below that conservative estimate.
What P/E ratio does CATO trade at?
CATO does not have a meaningful P/E right now, usually a sign of unprofitability or an earnings transition. For unprofitable growth names, price-to-sales is the more useful gauge.
Is CATO a buy based on valuation?
Our Smart Value rating for CATO is Hold, from a Smart Value Score of 57/100 that blends growth, quality, and valuation. The profile is balanced and best suited to investors who already have a thesis. This is research to inform your decision, not personalized financial advice.
How does CATO's valuation compare to its history?
There is not enough historical valuation data yet for a confident percentile read on CATO.
What is CATO's Smart Value Score?
CATO's Smart Value Score is 57/100. It is a proprietary WallStSmart metric blending growth quality, financial health, and valuation into a single 0-100 read, and scores above 75 are rare, signaling strong multi-factor alignment.