Safeway Inc. (SWY): Today's Featured Retail Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Safeway ( SWY) pushed the Retail industry lower today making it today's featured Retail laggard. The industry as a whole closed the day down 0.5%. By the end of trading, Safeway fell 38 cents (-2.3%) to $16.28 on light volume. Throughout the day, 4.1 million shares of Safeway exchanged hands as compared to its average daily volume of 6.1 million shares. The stock ranged in price between $16.27-$16.66 after having opened the day at $16.60 as compared to the previous trading day's close of $16.66. Other companies within the Retail industry that declined today were: ValueVision Media ( VVTV), down 15.2%, Coastal Contacts ( COA), down 5.8%, Big Lots ( BIG), down 5%, and Orchard Supply Hardware ( OSH), down 4.8%.
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Safeway Inc., together with its subsidiaries, operates as a food and drug retailer in North America. Safeway has a market cap of $3.98 billion and is part of the services sector. The company has a P/E ratio of 8.9, below the S&P 500 P/E ratio of 17.7. Shares are down 21.1% year to date as of the close of trading on Monday. Currently there are five analysts that rate Safeway a buy, four analysts rate it a sell, and eight rate it a hold.

TheStreet Ratings rates Safeway as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, attractive valuation levels and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, poor profit margins and weak operating cash flow.

On the positive front, Casual Male Retail Group ( CMRG), up 6.4%, Bon-Ton Stores ( BONT), up 4.2%, Home Depot ( HD), up 3.6%, and Citi Trends ( CTRN), up 3.4%, were all gainers within the retail industry with TJX Companies ( TJX) being today's featured retail industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the retail industry could consider SPDR S&P Retail ETF ( XRT) while those bearish on the retail industry could consider ProShares Ultra Sht Consumer Goods ( SZK).

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