Reitmans Stock is Close to 52-Week Lows: Is it a Buy-Low Candidate?

Reitmans (TSX:RET) is a Toronto-based apparel retailer. The stock was up 4.84% in early afternoon trading on April 12. Shares have plunged 16.4% in 2019 so far.

Reitmans sunk to a 52-week low of $3.10 in trading on April 11. Like other traditional retailers, Reitmans has struggled with its brick-and-mortar count. It is making an e-commerce platform push, but the process has been slow.

The company released its fourth-quarter and full-year results for fiscal 2019 on April 3. For the full-year Reitmans reported earnings from operating activities of $18.2 million compared to a net loss of $27.2 million from the prior year.

This improvement was largely due to a decline in selling, distribution and administration costs even with gross profit suffering a dip to $14.8 million.

Sales for fiscal 2019 experienced a 4.3% year-over-year drop to $923 million. This was primarily due to the net reduction of 42 stores. The previous year also included an extra week and $12.4 million in sales.

Reitmans plans to continue with its reduction in store presence in select markets while boosting its e-commerce platform. Comparable sales including e-commerce decreased only 0.6%.

On the plus side Reitmans still offers an attractive quarterly dividend of $0.05 per share which represents a 4.8% yield.

Reitmans stock had an RSI of 44 as of this writing. This puts it in neutral territory even after reaching a 52-week low. The company has a steel hill to climb and there are simply better options in this volatile sector right now.