Carter's Retail Growth Accelerates: Will Same-Store Sales Maintain Their Strength?

Carter’s Retail Business Gains Traction

Carter's, Inc. (CRI) is experiencing renewed strength in its retail operations, fueled by rising consumer interest and increased activity both in-store and online. The company’s approach—focusing on enhancing its brand reputation, launching fresh product lines, and investing in marketing efforts—has successfully boosted store traffic and attracted new shoppers. With its established children’s clothing brands and a growing emphasis on direct-to-consumer sales, Carter’s is steadily regaining sales momentum and positioning itself for ongoing success in the competitive apparel sector.

During the fourth quarter of 2025, Carter’s retail division posted impressive results. Retail net sales climbed 9.4% compared to the previous year, and comparable sales increased by 4.7%, marking the third straight quarter of positive growth. This progress was largely driven by robust online activity, strong demand across baby, toddler, and kids’ categories, and higher average selling prices. The baby segment, in particular, continued to perform well, achieving its sixth consecutive quarter of growth and underscoring steady demand for essential products.

To further strengthen its retail performance, Carter’s is enhancing its digital and omnichannel capabilities. The company is investing in initiatives that seamlessly connect its physical stores with its e-commerce platform, making it easier for customers to shop across multiple channels. Recent quarters have seen significant increases in online traffic, demonstrating how digital engagement is contributing to overall sales and improving the shopping experience. By upgrading its website, utilizing targeted digital marketing, and integrating store and online inventory, Carter’s is creating a more unified customer journey. This omnichannel strategy not only boosts engagement but also supports the company’s efforts to maintain comparable sales growth and expand its direct-to-consumer business.

Looking forward, Carter’s anticipates its retail segment will remain a primary driver of growth, supported by ongoing investments in marketing, product development, and digital innovation. Management is also prioritizing the attraction of higher-income customers and reducing promotional activity to reinforce pricing strength. Although challenges such as tariffs and rising costs persist, continued increases in store traffic and an improved product mix may help Carter’s sustain positive comparable sales and maintain retail momentum in the coming quarters.

CRI’s Stock Performance, Valuation, and Analyst Estimates

Over the past three months, Carter’s shares have risen by 7.5%, while the industry as a whole has declined by 17.6%.

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In terms of valuation, CRI is trading at a forward price-to-earnings ratio of 11.69, which is notably lower than the industry average of 22.39.

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Carter’s currently holds a Zacks Rank #1, indicating a strong buy recommendation.

Top Picks in the Consumer Discretionary Sector

• Crocs, Inc. (CROX): This leading footwear company has a Zacks Rank #2 (Buy). Over the past four quarters, Crocs has delivered an average earnings surprise of 16.6%. The Zacks Consensus Estimate projects a 7.2% increase in EPS for the current fiscal year compared to last year.
• Ralph Lauren (RL): As a designer and marketer of premium lifestyle products, Ralph Lauren also holds a Zacks Rank #2. The company has averaged a 9.7% earnings surprise over the last four quarters, and the consensus estimate suggests a 12.4% rise in sales for the current fiscal year versus the prior year.
• Kontoor Brands, Inc. (KTB): This apparel company is rated Zacks Rank #2. The consensus estimate anticipates a 15.6% increase in EPS for the current fiscal year compared to last year, with an average earnings surprise of 13.9% over the past four quarters.

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• Ralph Lauren Corporation (RL): Free Stock Analysis Report
• Crocs, Inc. (CROX): Free Stock Analysis Report
• Carter's, Inc. (CRI): Free Stock Analysis Report
• Kontoor Brands, Inc. (KTB): Free Stock Analysis Report

Original article published by Zacks Investment Research

Zacks Investment Research