3 Specialty Retail Stocks Driving The 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.

Two out of the three major indices traded up today One out of the three major indices traded up today The three major indices are trading lower today with the Dow Jones Industrial Average ( ^DJI) trading down 19.71 points (-0.1%) at 17,049 as of Thursday, Sept. 11, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,733 issues advancing vs. 1,330 declining with 151 unchanged.

The Specialty Retail industry as a whole closed the day up 0.7% versus the S&P 500, which was up 0.1%. Top gainers within the Specialty Retail industry included Dover Saddlery ( DOVR), up 2.8%, China Auto Logistics ( CALI), up 4.0%, Lentuo International ( LAS), up 2.8%, 1-800 Flowers.com ( FLWS), up 5.1% and HHGregg ( HGG), up 6.0%.

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

Lentuo International ( LAS) is one of the companies that pushed the Specialty Retail industry higher today. Lentuo International was up $0.07 (2.8%) to $2.54 on heavy volume. Throughout the day, 263,000 shares of Lentuo International exchanged hands as compared to its average daily volume of 118,600 shares. The stock ranged in a price between $2.26-$2.55 after having opened the day at $2.47 as compared to the previous trading day's close of $2.47.

Lentuo International Inc. operates automobile franchise dealerships in the People's Republic of China. Lentuo International has a market cap of $78.2 million and is part of the services sector. Shares are down 10.2% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Lentuo International 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 Lentuo International as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, a generally disappointing performance in the stock itself and poor profit margins.

Highlights from TheStreet Ratings analysis on LAS go as follows:

  • The revenue growth came in higher than the industry average of 0.3%. Since the same quarter one year prior, revenues rose by 11.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Specialty Retail industry. The net income increased by 212.3% when compared to the same quarter one year prior, rising from -$1.30 million to $1.46 million.
  • LENTUO INTERNATIONAL -ADR reported significant earnings per share improvement 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, LENTUO INTERNATIONAL -ADR turned its bottom line around by earning $0.12 versus -$0.03 in the prior year.
  • LAS has underperformed the S&P 500 Index, declining 11.84% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The debt-to-equity ratio of 1.38 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with this, the company manages to maintain a quick ratio of 0.29, which clearly demonstrates the inability to cover short-term cash needs.

You can view the full analysis from the report here: Lentuo International 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 $0.08 (4.0%) to $2.03 on light volume. Throughout the day, 14,861 shares of China Auto Logistics exchanged hands as compared to its average daily volume of 27,100 shares. The stock ranged in a price between $1.93-$2.03 after having opened the day at $1.93 as compared to the previous trading day's close of $1.95.

China Auto Logistics Inc. sells and trades in imported automobiles in the People's Republic of China. China Auto Logistics has a market cap of $8.1 million and is part of the services sector. Shares are down 45.2% year-to-date as of the close of trading on Wednesday. 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 3.51 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 0.72, 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 0.92%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.62% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$13.35 million or 621.85% 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.

Dover Saddlery ( DOVR) was another company that pushed the Specialty Retail industry higher today. Dover Saddlery was up $0.14 (2.8%) to $5.04 on light volume. Throughout the day, 651 shares of Dover Saddlery exchanged hands as compared to its average daily volume of 10,700 shares. The stock ranged in a price between $4.77-$5.04 after having opened the day at $4.77 as compared to the previous trading day's close of $4.90.

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 $26.8 million and is part of the services sector. Shares are down 6.5% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Dover Saddlery a buy, no analysts rate it a sell, and none rate it a hold.

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 feeble growth in the company's earnings per share, unimpressive growth in net income and generally higher debt management risk.

Highlights from TheStreet Ratings analysis on DOVR go as follows:

  • DOVR's revenue growth has slightly outpaced the industry average of 0.3%. Since the same quarter one year prior, revenues slightly increased by 6.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, DOVR's share price has jumped by 29.76%, 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.
  • 39.96% 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 1.07% trails the industry average.
  • DOVER SADDLERY INC's earnings per share declined by 16.7% in the most recent quarter compared to 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, DOVER SADDLERY INC reported lower earnings of $0.27 versus $0.31 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 26.2% when compared to the same quarter one year ago, falling from $0.36 million to $0.26 million.

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.

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.

More from Markets

Lowe's Snags Ex-Home Depot Exec as CEO; ISPs Face Competitive Threat -- ICYMI

Lowe's Snags Ex-Home Depot Exec as CEO; ISPs Face Competitive Threat -- ICYMI

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Dow Slips 178 Points; S&P 500 and Nasdaq Also Decline

Legal Weed Sales in California Are Off to a Less Than Smokin' Start

Legal Weed Sales in California Are Off to a Less Than Smokin' Start

Owner of Moviepass Sees Stock Plummet

Owner of Moviepass Sees Stock Plummet

Ford, GM Gain as China Slashes Auto Import Tariffs

Ford, GM Gain as China Slashes Auto Import Tariffs