Ten days after opening this position in CATO on February 1, I was feeling pretty smart. The stock had gained nearly 8% and appeared to be making a beeline for our $29 target price. Ten days after that it was apparent that the stock had run out of momentum, and now I’m not feeling so smart after it wilted over the next ten days to drop all the way back to our entry price.

It appears CATO’s shareholders can be as fickle as the fashion tastes of the young ladies that comprise its primary customer base. And if diamonds are a girl’s best friend, then it seems the company believes that paying an outsized dividend yield of 5% is the best way to say “I’m sorry, and I’ll never take you for granted again” to its very patient shareholders that have witnessed its share price decline by nearly a third during the past year.

In our case we entered this holding only a month ago and are still at breakeven, so we’re playing it for a bounce before our target holding period expires on May 1. A lot of the fashion apparel CATO sells is manufactured overseas, so CATO is another stock that could rally if Trump’s plan for a border adjustment tariff is either rescinded or revised before then. In the meantime, the company is scheduled to release quarterly earnings on March 16 so we should soon know if the stock has found a bottom yet.