3 Stocks Pushing The Specialty Retail Industry Lower

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.

The Specialty Retail industry as a whole closed the day down 0.3% versus the S&P 500, which was down 0.6%. Laggards within the Specialty Retail industry included China Auto Logistics ( CALI), down 1.6%, Dover Saddlery ( DOVR), down 1.8%, DGSE Companies ( DGSE), down 7.7%, CSS Industries ( CSS), down 2.3% and 1-800 Flowers.com ( FLWS), down 2.3%.

TheStreet Ratings Group would like to highlight 3 stocks that pushed the industry lower today:

CSS Industries ( CSS) is one of the companies that pushed the Specialty Retail industry lower today. CSS Industries was down $0.58 (2.3%) to $24.43 on light volume. Throughout the day, 4,593 shares of CSS Industries exchanged hands as compared to its average daily volume of 22,200 shares. The stock ranged in price between $24.40-$25.23 after having opened the day at $25.04 as compared to the previous trading day's close of $25.01.

CSS Industries, Inc., a consumer products company, is engaged in the design, manufacture, procurement, distribution, and sale of various occasion and seasonal social expression products primarily to mass market retailers primarily in the United States and Canada. CSS Industries has a market cap of $225.7 million and is part of the consumer goods sector. Shares are down 12.8% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates CSS Industries as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from TheStreet Ratings analysis on CSS go as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Household Durables industry. The net income increased by 20.5% when compared to the same quarter one year prior, going from -$1.67 million to -$1.33 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.7%. Since the same quarter one year prior, revenues slightly increased by 2.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • CSS 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. Along with this, the company maintains a quick ratio of 3.70, which clearly demonstrates the ability to cover short-term cash needs.
  • CSS INDUSTRIES INC has improved earnings per share by 22.2% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. During the past fiscal year, CSS INDUSTRIES INC increased its bottom line by earning $1.97 versus $1.62 in the prior year.

You can view the full analysis from the report here: CSS Industries Ratings Report

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At the close, Dover Saddlery ( DOVR) was down $0.09 (1.8%) to $5.05 on light volume. Throughout the day, 179 shares of Dover Saddlery exchanged hands as compared to its average daily volume of 10,000 shares. The stock ranged in price between $5.05-$5.05 after having opened the day at $5.05 as compared to the previous trading day's close of $5.14.

Dover Saddlery, Inc. operates as a specialty retailer and omni-channel marketer of equestrian products in the United States. The company offers a selection of products required to own, ride, train, and compete with a horse. Dover Saddlery has a market cap of $27.1 million and is part of the consumer goods sector. Shares are down 3.9% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Dover Saddlery as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from TheStreet Ratings analysis on DOVR go as follows:

  • DOVR's revenue growth has slightly outpaced the industry average of 0.5%. Since the same quarter one year prior, revenues slightly increased by 9.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • Compared to its closing price of one year ago, DOVR's share price has jumped by 39.24%, exceeding the performance of the broader market during that same time frame. Although DOVR had significant growth over the past year, our hold rating indicates that we do not recommend additional investment in this stock at the current time.
  • 37.72% is the gross profit margin for DOVER SADDLERY INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -2.75% trails the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Specialty Retail industry average. The net income has decreased by 0.9% when compared to the same quarter one year ago, dropping from -$0.54 million to -$0.54 million.
  • Net operating cash flow has significantly decreased to -$7.09 million or 81.24% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

You can view the full analysis from the report here: Dover Saddlery 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.

China Auto Logistics ( CALI) was another company that pushed the Specialty Retail industry lower today. China Auto Logistics was down $0.03 (1.6%) to $1.86 on heavy volume. Throughout the day, 53,687 shares of China Auto Logistics exchanged hands as compared to its average daily volume of 24,800 shares. The stock ranged in price between $1.76-$1.98 after having opened the day at $1.83 as compared to the previous trading day's close of $1.89.

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 $7.5 million and is part of the consumer goods sector. Shares are down 47.5% year-to-date as of the close of trading on Wednesday.

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.

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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.

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