Is The Cato Corp. CATO stock halal to invest in?

No, as of August 2026, The Cato Corp. stock (CATO) is not currently classified as a Shariah compliant stock. This verdict follows the screening methodology of AAOIFI (the Accounting and Auditing Organization for Islamic Financial Institutions), whose Shariah Standard No. 21 is the leading global benchmark for screening halal stocks. To qualify as halal under this standard, a company must keep non-permissible income below 5% of total revenue, keep both interest-bearing investments and interest-bearing debt below 30% of market capitalisation, and have no impermissible preference share structure. The Cato Corp. currently does not meet the threshold for the interest-bearing investments screen. Because screenings are refreshed monthly as new financial reports are published, a non-compliant stock can regain compliant status if its financial structure changes. You can track the latest status of The Cato Corp. and discover Shariah compliant alternatives among the halal stocks in the Tabadulat app.

How often is The Cato Corp. CATO reviewed for Shariah compliance?

Tabadulat reviews The Cato Corp. CATO for Shariah compliance every month. Each review applies the AAOIFI Shariah Standard No. 21 methodology, screening the company's business activities, non-permissible income, interest-bearing investments, interest-bearing debt, and preference shares, against the company's latest available financial data. The process operates under the direct supervision of Tabadulat's dedicated Shariah Supervisory Board of Islamic finance scholars. Because compliance depends on financial ratios that move with market capitalisation and reported results, a stock's status can change from one review to the next. Monthly screening ensures the status shown for The Cato Corp. reflects current financial data rather than an outdated assessment, and Tabadulat app users are notified if a holding in their portfolio becomes non-compliant.

Does The Cato Corp. CATO pass the AAOIFI Non Permissible Income criteria?

Yes, as of August 2026, The Cato Corp. stock (CATO) passes the AAOIFI non-permissible income screen. Under AAOIFI Shariah Standard No. 21, income from impermissible sources (such as interest or riba, conventional financial services, alcohol, gambling, or tobacco) must remain below 5% of a company's total revenue. The Cato Corp.'s income from non-permissible sources is currently within this 5% threshold. Even permissible levels of incidental impure income should still be purified: investors donate the corresponding share of dividends to charity, as reflected in the stock's purification factor. This screen is reassessed monthly using the company's latest financial disclosures.

Does The Cato Corp. CATO pass the AAOIFI Interest Bearing Investments criteria?

No, as of August 2026, The Cato Corp. stock (CATO) does not pass the AAOIFI interest-bearing investments screen. Under AAOIFI Shariah Standard No. 21, the cash a company places in interest-earning instruments (such as conventional deposits, bonds, treasury bills and money-market funds) must remain below 30% of its market capitalisation. The Cato Corp.'s interest-bearing investments currently exceed this 30% limit, meaning too large a share of the company's value derives from riba-based instruments for the stock to qualify as halal on this criterion. The ratio moves with both the balance sheet and the share price, and is reassessed monthly.

Does The Cato Corp. CATO pass the AAOIFI Interest Bearing Debt criteria?

Yes, as of August 2026, The Cato Corp. stock (CATO) passes the AAOIFI interest-bearing debt screen. Under AAOIFI Shariah Standard No. 21, a company's borrowings that accrue interest (conventional bank loans, bonds and similar riba-based financing) must remain below 30% of its market capitalisation. This cap limits shareholders' exposure to interest-based leverage. The Cato Corp.'s interest-bearing debt is currently within the 30% threshold. Because market capitalisation changes daily, a company's debt ratio can drift toward or away from the limit even without new borrowing, which is why this screen is reassessed every month.

What is the dividend purification factor for The Cato Corp. CATO stock?

The Cato Corp. (CATO) is currently classified as not Shariah compliant, so no dividend purification factor applies, because purification factors are calculated only for stocks that pass the AAOIFI screens. Purification (tazkiyah) is the practice of donating to charity the small portion of dividend income that stems from incidental non-permissible sources, such as interest earned on a compliant company's cash deposits. For non-compliant stocks the issue is not purification but eligibility: under AAOIFI Shariah Standard No. 21 the stock does not currently qualify as a halal investment. If The Cato Corp. returns to compliance in a future monthly screening, its purification factor will be published alongside its updated status in the Tabadulat app.

Does The Cato Corp. CATO pass the AAOIFI Preference Share screen?

Yes, as of August 2026, The Cato Corp. stock (CATO) passes the AAOIFI preference share screen. AAOIFI Shariah Standard No. 21 prohibits investing in preference shares because they grant holders guaranteed or priority rights to dividends and capital ahead of ordinary shareholders, a structure that conflicts with the Shariah principle that investors should share profit and loss in proportion to their ownership. The Cato Corp. has no impermissible preference share structure affecting its ordinary shares, so the stock is compliant on this criterion. Like all AAOIFI screens, this is verified in each monthly review.

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The Cato Corp.

NYSE

Shariah-Compliant

Not Shariah

CATO

About

The Cato Corp.

CATO

Cato Corporation is a prominent retail company specializing in affordable fashion for women. It primarily operates through two main retail concepts: Cato and Versona. The Cato brand offers on-trend apparel, shoes, and accessories that cater to value-conscious female consumers, aiming to provide an efficient shopping experience with frequent inventory updates. Versona, on the other hand, targets a slightly more upscale customer with a range of sophisticated fashion choices and accessories. The company serves its customers through a network of physical stores strategically located across the United States, as well as through robust online retail channels. Since its inception in 1946, Cato Corporation has played a significant role in the women's fashion retail sector by offering stylish and budget-friendly options. In addition to its retail operations, the company has been notable for its commitment to customer satisfaction and community involvement, which further enhances its standing in the competitive retail landscape. Cato Corporation's emphasis on affordability, style diversity, and multi-channel retailing underscores its sustained market presence.

Sector:

Consumer Cyclical

Industry:

Apparel Retail

Employees:

7000

Website:

https://www.catofashions.com

CATO

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The Cato Corp.

About

The Cato Corp.

CATO

Frequently asked questions

Is The Cato Corp. CATO stock halal to invest in?

How often is The Cato Corp. CATO reviewed for Shariah compliance?

Does The Cato Corp. CATO pass the AAOIFI Non Permissible Income criteria?

Does The Cato Corp. CATO pass the AAOIFI Interest Bearing Investments criteria?

Does The Cato Corp. CATO pass the AAOIFI Interest Bearing Debt criteria?

What is the dividend purification factor for The Cato Corp. CATO stock?

Does The Cato Corp. CATO pass the AAOIFI Preference Share screen?

Can I buy The Cato (CATO) stock on Tabadulat?

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