3 Stocks Driving The Specialty Retail Industry Higher

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 62 points (0.4%) at 17,114 as of Tuesday, July 22, 2014, 3:55 PM ET. The NYSE advances/declines ratio sits at 2,161 issues advancing vs. 822 declining with 149 unchanged.

The Specialty Retail industry as a whole closed the day up 0.1% versus the S&P 500, which was up 0.5%. Top gainers within the Specialty Retail industry included Sport Chalet ( SPCHB), up 2.6%, China Auto Logistics ( CALI), up 5.6%, Mecox Lane ( MCOX), up 3.7%, Lentuo International ( LAS), up 3.1% and Rush ( RUSHB), up 2.8%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the industry higher today:

Mecox Lane ( MCOX) is one of the companies that pushed the Specialty Retail industry higher today. Mecox Lane was up $0.16 (3.7%) to $4.45 on light volume. Throughout the day, 10,887 shares of Mecox Lane exchanged hands as compared to its average daily volume of 17,900 shares. The stock ranged in a price between $4.30-$4.69 after having opened the day at $4.32 as compared to the previous trading day's close of $4.29.

Mecox Lane Limited designs and sells apparel, accessories, and home and healthcare products through its online platform and stores in the People's Republic of China. Mecox Lane has a market cap of $55.7 million and is part of the services sector. Shares are up 17.5% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Mecox Lane a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Mecox Lane as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income and disappointing return on equity.

Highlights from TheStreet Ratings analysis on MCOX go as follows:

  • MECOX LANE LTD's earnings per share declined by 25.0% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, MECOX LANE LTD reported poor results of -$2.20 versus -$1.95 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Internet & Catalog Retail industry. The net income has significantly decreased by 37.3% when compared to the same quarter one year ago, falling from -$4.23 million to -$5.80 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Internet & Catalog Retail industry and the overall market, MECOX LANE LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • MCOX, with its decline in revenue, underperformed when compared the industry average of 4.8%. Since the same quarter one year prior, revenues slightly dropped by 8.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • MCOX has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.50 is very weak and demonstrates a lack of ability to pay short-term obligations.

You can view the full analysis from the report here: Mecox Lane Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

At the close, China Auto Logistics ( CALI) was up $0.13 (5.6%) to $2.38 on light volume. Throughout the day, 9,681 shares of China Auto Logistics exchanged hands as compared to its average daily volume of 20,900 shares. The stock ranged in a price between $2.24-$2.49 after having opened the day at $2.27 as compared to the previous trading day's close of $2.25.

China Auto Logistics Inc. sells and trades in imported automobiles in the People's Republic of China. It operates in five segments: Sales of Automobiles, Financing Services, Web-Based Advertising, Automobile Value Added Services, and Auto Mall Management Services. China Auto Logistics has a market cap of $8.5 million and is part of the services sector. Shares are down 36.9% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate China Auto Logistics a buy, no analysts rate it a sell, and none rate it a hold.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet Ratings rates China Auto Logistics as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, generally high debt management risk, disappointing return on equity and poor profit margins.

Highlights from TheStreet Ratings analysis on CALI go as follows:

  • The debt-to-equity ratio is very high at 3.22 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, CALI maintains a poor quick ratio of 0.77, which illustrates the inability to avoid short-term cash problems.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Specialty Retail industry and the overall market, CHINA AUTO LOGISTICS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CHINA AUTO LOGISTICS INC is currently extremely low, coming in at 1.36%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.25% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$12.77 million or 307.94% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • CHINA AUTO LOGISTICS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, CHINA AUTO LOGISTICS INC reported lower earnings of $0.16 versus $0.67 in the prior year.

You can view the full analysis from the report here: China Auto Logistics Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Sport Chalet ( SPCHB) was another company that pushed the Specialty Retail industry higher today. Sport Chalet was up $0.03 (2.6%) to $1.18 on heavy volume. Throughout the day, 16,112 shares of Sport Chalet exchanged hands as compared to its average daily volume of 3,200 shares. The stock ranged in a price between $1.15-$1.20 after having opened the day at $1.15 as compared to the previous trading day's close of $1.15.

Sport Chalet, Inc. operates as a specialty sporting goods retailer in the United States. Sport Chalet has a market cap of $2.1 million and is part of the services sector. Shares are down 9.8% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Sport Chalet a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Sport Chalet as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, generally high debt management risk, disappointing return on equity and poor profit margins.

Highlights from TheStreet Ratings analysis on SPCHB go as follows:

  • The debt-to-equity ratio is very high at 9.82 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.06, which clearly demonstrates the inability to cover short-term cash needs.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Specialty Retail industry and the overall market, SPORT CHALET INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for SPORT CHALET INC is rather low; currently it is at 24.02%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -7.13% is significantly below that of the industry average.
  • SPORT CHALET INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, SPORT CHALET INC reported poor results of -$0.71 versus -$0.23 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Specialty Retail industry. The net income has significantly decreased by 146.6% when compared to the same quarter one year ago, falling from -$2.31 million to -$5.71 million.

You can view the full analysis from the report here: Sport Chalet Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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