1-Star Stocks Poised to Plunge: Pier 1 Imports?
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, home furnishings retailer Pier 1 Imports (NYS: PIR) has received the dreaded one-star ranking.
With that in mind, let's take a closer look at Pier 1's business and see what CAPS investors are saying about the stock right now.
Pier 1facts
Headquarters (founded) | Fort Worth, Texas (1970) |
Market Cap | $1.8 billion |
Industry | Home furnishing retail |
Trailing-12-Month Revenue | $1.6 billion |
Management | CEO Alexander Smith (since 2007) |
Return on Equity (average, past 3 years) | 31.2% |
Cash/Debt | $217.9 million / $9.5 million |
Dividend Yield | 1% |
Competitors | Bed Bath & Beyond |
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 54% of the 573 members who have rated Pier 1 believe the stock will underperform the S&P 500 going forward.
Just last week, one of those Fools, jed71, succinctly summed up the bear case for our community:
I honestly don't have a problem with [Pier 1], but label me a skeptic of their business model and valuation. I guess I just question the run up of [Pier 1] from a penny stock in 2009 to the current valuation of ~$16. I have thought of them as a fad retailer on their way out for a number of years but the stock price seems to continue to defy gravity. I don't know anyone who shops their stores anymore, and I just can't see the new generation of women shoppers buying home decorative items from the stores. Their demographic is getting older, and they haven't really made a huge effort to reach the younger generation of customers.
If you want market-thumping returns, you need to protect your portfolio from any undue risk. Luckily, we've found another retailer we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2012." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.
Want to see how well (or not so well) the stocks in this series are performing? Follow theTrackPoisedToCAPS account.
The article 1-Star Stocks Poised to Plunge: Pier 1 Imports? originally appeared on Fool.com.
Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Bed Bath & Beyond. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.
