Carter’s (NYSE:CRI) Shares Gap Down – Should You Sell?

Carter’s, Inc. (NYSE:CRI)’s share price gapped down prior to trading on Friday . The stock had previously closed at $42.07, but opened at $36.42. Carter’s shares last traded at $35.1220, with a volume of 1,348,396 shares changing hands.

Carter’s News Roundup

Here are the key news stories impacting Carter’s this week:

• Positive Sentiment: Q4 results beat estimates — stronger sales and an EPS beat, evidence of demand rebound and execution. Carter’s, Inc. Reports Fourth Quarter and Fiscal Year 2025 Results
• Positive Sentiment: Quarterly metrics: revenue and EPS topped estimates and sales grew ~7.6–7.7% year-over-year, supporting topline momentum. Carter’s (CRI) Q4 Earnings and Revenues Surpass Estimates
• Neutral Sentiment: Full press release, slide deck and conference call are available for details on segment trends and management commentary. Press Release / Slide Deck
• Neutral Sentiment: Earnings call transcript and coverage provide the exact cadence of management’s guidance and Q&A for deeper read-throughs. Carter’s (CRI) Q4 2025 Earnings Call Transcript
• Negative Sentiment: Company cut Q1 FY26 EPS guidance to $0.02–$0.08 vs. street $0.36, the primary catalyst for the share decline as investors reprice near-term profitability.
• Negative Sentiment: Analysts and media flagged a weak profit outlook despite the beat, noting the guide drove outsized share weakness. Carter’s slides after weak profit outlook
• Negative Sentiment: Coverage highlights margin pressure and tariff/headwind risks plus concerns about cash generation — factors that explain why FY26 EPS guidance was tempered. Carter’s (CRI) Shares Plunge on Margin Pressure, Tariff Headwinds, and Weakening Cash Generation
• Negative Sentiment: Analysis points to gross-margin challenges and constrained pricing power, which could keep near-term margins under pressure. Carter’s Gross Margins Show Challenges With Pricing Power
• Negative Sentiment: Post-earnings coverage summarizes the beat but underscores the soft guide as the reason shares fell sharply. Carter’s Q4 Earnings Beat Estimates, Shares Fall on Soft EPS View

Wall Street Analyst Weigh In

CRI has been the topic of several research reports. The Goldman Sachs Group raised their price objective on shares of Carter’s from $26.00 to $29.00 and gave the stock a “sell” rating in a research report on Tuesday, January 13th. Weiss Ratings upgraded Carter’s from a “sell (d+)” rating to a “hold (c-)” rating in a research report on Thursday, February 19th. Wall Street Zen raised Carter’s from a “sell” rating to a “hold” rating in a research note on Sunday, January 11th. UBS Group lifted their target price on Carter’s from $33.00 to $40.00 and gave the company a “neutral” rating in a research note on Thursday, February 19th. Finally, Zacks Research raised Carter’s from a “hold” rating to a “strong-buy” rating in a report on Monday, January 19th. One investment analyst has rated the stock with a Strong Buy rating, one has issued a Buy rating, two have issued a Hold rating and three have given a Sell rating to the stock. Based on data from MarketBeat, the stock has an average rating of “Hold” and an average price target of $34.00.

Carter’s Stock Performance

The stock has a 50 day moving average of $36.42 and a two-hundred day moving average of $32.33. The stock has a market capitalization of $1.22 billion, a PE ratio of 13.30 and a beta of 1.06. The company has a debt-to-equity ratio of 0.58, a current ratio of 2.26 and a quick ratio of 0.95.

Carter’s (NYSE:CRI) last released its earnings results on Friday, February 27th. The textile maker reported $1.90 EPS for the quarter, beating analysts’ consensus estimates of $1.70 by $0.20. Carter’s had a return on equity of 16.71% and a net margin of 3.15%.The company had revenue of $925.45 million during the quarter, compared to the consensus estimate of $912.36 million. During the same quarter last year, the company earned $2.39 earnings per share. Carter’s’s quarterly revenue was up 7.7% compared to the same quarter last year. Carter’s has set its Q1 2026 guidance at 0.020-0.080 EPS. Research analysts expect that Carter’s, Inc. will post 5.15 EPS for the current fiscal year.

Carter’s Announces Dividend

The business also recently announced a quarterly dividend, which will be paid on Friday, March 27th. Shareholders of record on Friday, March 13th will be given a dividend of $0.25 per share. This represents a $1.00 annualized dividend and a yield of 3.0%. The ex-dividend date is Friday, March 13th. Carter’s’s dividend payout ratio is presently 40.49%.

Institutional Investors Weigh In On Carter’s

A number of hedge funds and other institutional investors have recently modified their holdings of the stock. UMB Bank n.a. grew its holdings in shares of Carter’s by 445.8% in the 4th quarter. UMB Bank n.a. now owns 775 shares of the textile maker’s stock worth $25,000 after acquiring an additional 633 shares during the period. Caitong International Asset Management Co. Ltd boosted its position in Carter’s by 555.9% during the third quarter. Caitong International Asset Management Co. Ltd now owns 1,115 shares of the textile maker’s stock worth $31,000 after purchasing an additional 945 shares in the last quarter. Hantz Financial Services Inc. grew its holdings in Carter’s by 1,208.1% in the third quarter. Hantz Financial Services Inc. now owns 1,295 shares of the textile maker’s stock valued at $37,000 after purchasing an additional 1,196 shares during the last quarter. Versant Capital Management Inc increased its position in shares of Carter’s by 135.4% in the third quarter. Versant Capital Management Inc now owns 1,415 shares of the textile maker’s stock valued at $40,000 after buying an additional 814 shares in the last quarter. Finally, EverSource Wealth Advisors LLC raised its stake in shares of Carter’s by 202.6% during the 2nd quarter. EverSource Wealth Advisors LLC now owns 1,486 shares of the textile maker’s stock worth $45,000 after buying an additional 995 shares during the last quarter.

About Carter’s

Carter’s, Inc (NYSE: CRI) is a leading designer and marketer of infant and young children’s apparel in North America. Headquartered in Atlanta, Georgia, the company’s core business focuses on creating clothing and accessories for babies and children, including bodysuits, sleepwear, layette, outerwear and accessories that blend comfort, safety and style. Carter’s flagship brand is complemented by its OshKosh B’gosh line, which offers heritage-inspired designs and durable fabrics for toddlers and young kids.

The company distributes its products through a diversified platform that includes wholesale partnerships with major department stores and mass merchandisers, direct‐to‐consumer e-commerce sites, and an extensive network of company-operated retail stores.