Based on the aggregated intelligence of 150,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, home furnishings retailer Pier 1 Imports (NYSE: 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 1 facts
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Headquarters (Founded)
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Fort Worth, Texas (1970)
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Market Cap
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$829.9 million
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Industry
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Home furnishing retail
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Trailing-12-Month Revenue
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$1.3 billion
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Management
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CEO Alexander Smith (since 2007)
CFO Charles Turner (since 1999)
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Return on Capital (Average, Past 3 Years)
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(12.3%)
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Compound Annual Revenue Growth (Over Past 3 Years)
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(8.1%)
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1-Year Return
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3,021%
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Competitors
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Bed Bath & Beyond (Nasdaq: BBBY )
Williams-Sonoma (NYSE: WSM )
Cost Plus (Nasdaq: CPWM )
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Alternative Retail Stocks
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Wal-Mart (NYSE: WMT )
Costco Wholesale (Nasdaq: COST )
Walgreen (NYSE: WAG )
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Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 65% of the 492 members who have rated Pier 1 believe the stock will underperform the S&P 500 going forward. These bears include 00101 and All-Star tthwebster, who is ranked in the top 16% of our community.
Late last year, 00101 strongly advised Fools to jump off Pier 1: "Downthumb. Negative cash flow. Negative sales growth. Selling off assets. ... Good balance sheet now. But have to prove their profit growth. Difficult to gauge quarterly report."
In a pitch from one month later, tthwebster showed skepticism over the stock's surging price:
Had a good run up. Nothing impressive financially except perhaps that they might start making a little bit of money. Four huge negative years and maybe this year a slight profit. Doesn't warrant a 700m market cap though. Ok. I'll admit that appears some light at the end of a long tunnel, but it's up already, no outperform of the S&P that's for sure.
What do you think about Pier 1, or any other stock for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!
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