The last month has been pretty awful for retailers' shares, with continued high unemployment, fragile consumer confidence, and growing concern that the economic expansion is running out of steam.
The Gap Price Stock Chart by YCharts
The government's retail sales figures show the slowdown, too:
Retail Sales Chart by YCharts
The sell-off has pushed several retail stocks down far enough that YCharts Pro stock ratings views them as attractive and undervalued. These ratings, of course, are based on historical valuations, so if a company has newly fallen into the hands of incompetent management or suffered some other secular mishap, the ratings could well be in error. But five companies considered mostly well-managed are worth a look. Ask yourself: do you see the current economic malaise as a short-term thing? If so, this could be a buying opportunity. Also ask yourself: Do you believe in the individual company's future? If not, avoid the shares even if they're cheap. Giving each of these companies a workout on YCharts, from P/E ratio to dividend yield to price/sales ratio and more will answer some of your questions.
Staples (Nasdaq: SPLS ) : The stock went from about 21 to 15 since the beginning of May, lifting the dividend yield above 2.5%. The dividend, reduced since 2008, now seems well covered. It's true that Staples' customers -- including small businesses and work-at-home proprietors are particularly stressed in this economy. But the company has a dominant position in its markets.
Staples Dividend Stock Chart by YCharts
Target (NYSE: TGT ) : It's dividend yield also rose above 2.5% and is exceedingly well-covered. And Target's price-to-sales ratio has dipped even as its margins remain healthy. Target is a must-stop for new renters and homeowners, and as the economy picks up, those big-spending customers will reappear.
Target Corporation Price / Sales Ratio Stock Chart by YCharts
Wal-Mart (NYSE: WMT ) : Another dividend yield above 2.5% and also well covered, and with a history of stead dividend increases. The problem, of course, is that Wal-Mart has gotten so darned big that its U.S. sales track the economy. And right now, the U.S. economy sucks. But the company buys back oodles of stock and manages operations brilliantly, lifting profits faster than sales in almost every environment.
Wal-Mart Stores Dividend Stock Chart by YCharts
Kohls (NYSE: KSS ) : J.C. Penney (NYSE: JCP ) got all the attention last week for snagging Apple's (Nasdaq: AAPL ) retail boss Ron Johnson as its new CEO. The betting here is he'll find it tougher to generate retail excitement over linens and ladies' clothing than he did over Steve Jobs' cool gadgets. Kohl's, meanwhile, has kept its revenues -- and its margins -- growing in this tough retail environment.
Kohls Corporation Revenues Stock Chart by YCharts
GAP (NYSE: GPS ) : Its shares got hammered after Gap reported crummy first-quarter results. The company in recent years vastly improved its financial management in recent years, but can't seem to get sales growing consistently again. Its dividend yield is just shy of 2.5% and well covered. But this revenue growth chart is a nightmare. Gap's the hardest among these companies to believe in.
The Gap Revenue Growth Stock Chart by YCharts
Jeff Bailey is an editor for the YCharts Pro Investor Service which includes professional stock charts, stock ratings and portfolio strategies.
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