3 Stocks Pushing The 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 Retail industry as a whole was unchanged today versus the S&P 500, which was up 0.5%. Laggards within the Retail industry included QKL Stores ( QKLS), down 5.2%, China Jo-Jo Drugstores ( CJJD), down 1.7%, U S Auto Parts Network ( PRTS), down 3.6%, dELiA*s ( DLIA), down 4.3% and Wet Seal ( WTSL), down 1.8%.

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

U S Auto Parts Network ( PRTS) is one of the companies that pushed the Retail industry lower today. U S Auto Parts Network was down $0.10 (3.6%) to $2.67 on light volume. Throughout the day, 36,993 shares of U S Auto Parts Network exchanged hands as compared to its average daily volume of 61,900 shares. The stock ranged in price between $2.66-$2.78 after having opened the day at $2.75 as compared to the previous trading day's close of $2.77.

U.S. Auto Parts Network, Inc., together with its subsidiaries, operates as an online retailer of automotive aftermarket parts and accessories primarily in the United States, Canada, and the Philippines. It operates in two segments, Base USAP and AutoMD. U S Auto Parts Network has a market cap of $95.2 million and is part of the services sector. Shares are up 11.7% year-to-date as of the close of trading on Tuesday. Currently there are 2 analysts who rate U S Auto Parts Network a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates U S Auto Parts Network as a sell. The company's weaknesses can be seen in multiple areas, such as its poor profit margins and generally high debt management risk.

Highlights from TheStreet Ratings analysis on PRTS go as follows:

  • The gross profit margin for US AUTO PARTS NETWORK INC is currently lower than what is desirable, coming in at 27.16%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -2.83% trails that of the industry average.
  • Despite currently having a low debt-to-equity ratio of 0.48, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.18 is very low and demonstrates very weak liquidity.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Internet & Catalog Retail industry and the overall market, US AUTO PARTS NETWORK INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly increased by 910.42% to $3.27 million when compared to the same quarter last year. In addition, US AUTO PARTS NETWORK INC has also vastly surpassed the industry average cash flow growth rate of 9.75%.
  • This stock has increased by 63.78% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the future course of this stock, we feel that the risks involved in investing in PRTS do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.

You can view the full analysis from the report here: U S Auto Parts Network Ratings Report

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At the close, China Jo-Jo Drugstores ( CJJD) was down $0.03 (1.7%) to $1.72 on light volume. Throughout the day, 7,550 shares of China Jo-Jo Drugstores exchanged hands as compared to its average daily volume of 57,100 shares. The stock ranged in price between $1.67-$1.78 after having opened the day at $1.73 as compared to the previous trading day's close of $1.75.

China Jo-Jo Drugstores, Inc. operates as a retailer and distributor of pharmaceutical and other healthcare products in the People's Republic of China. China Jo-Jo Drugstores has a market cap of $27.1 million and is part of the services sector. Shares are up 87.5% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates China Jo-Jo Drugstores as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, poor profit margins, weak operating cash flow and generally high debt management risk.

Highlights from TheStreet Ratings analysis on CJJD go as follows:

  • 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 Food & Staples Retailing industry and the overall market, CHINA JO-JO DRUGSTORES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CHINA JO-JO DRUGSTORES INC is rather low; currently it is at 18.31%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -2.10% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$1.85 million or 152.73% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • CJJD's debt-to-equity ratio of 0.66 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.46 is very low and demonstrates very weak liquidity.
  • CHINA JO-JO DRUGSTORES INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, CHINA JO-JO DRUGSTORES INC reported poor results of -$1.81 versus -$1.05 in the prior year.

You can view the full analysis from the report here: China Jo-Jo Drugstores 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.

QKL Stores ( QKLS) was another company that pushed the Retail industry lower today. QKL Stores was down $0.15 (5.2%) to $2.72 on light volume. Throughout the day, 200 shares of QKL Stores exchanged hands as compared to its average daily volume of 3,200 shares. The stock ranged in price between $2.72-$2.72 after having opened the day at $2.72 as compared to the previous trading day's close of $2.87.

QKL Stores Inc., together with its subsidiaries, operates a supermarket chain in northeastern China and Inner Mongolia. QKL Stores has a market cap of $4.4 million and is part of the services sector. Shares are down 31.7% year-to-date as of the close of trading on Tuesday.

TheStreet Ratings rates QKL Stores as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally high debt management risk, poor profit margins, weak operating cash flow and generally disappointing historical performance in the stock itself.

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

Highlights from TheStreet Ratings analysis on QKLS go as follows:

  • 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 Food & Staples Retailing industry. The net income has significantly decreased by 158.8% when compared to the same quarter one year ago, falling from -$1.45 million to -$3.76 million.
  • The debt-to-equity ratio of 1.30 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, QKLS has a quick ratio of 0.56, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • The gross profit margin for QKL STORES INC is rather low; currently it is at 16.82%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -7.28% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to $2.17 million or 58.24% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 41.05%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 157.29% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.

You can view the full analysis from the report here: QKL Stores 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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