Three of the retail greats reported earnings this week, and oh how differently the market reacted to each of them.

In this clip, host Chris Hill and Motley Fool contributor Ron Gross go through the most important numbers and trends from Nordstrom (NYSE:JWN), Macy's (NYSE:M), and JC Penney (NYSE:JCP), explain why the stocks went in the directions they did after reports came out, and take a peek at the long-term health of each mall-based retailer.

A full transcript follows the video.

This video was recorded on Aug. 17, 2018.

Chris Hill: More retail earnings this week. Nordstrom's second quarter profits came in higher than Wall Street was expecting. Shares of Macy's falling despite second quarter profits also coming in higher than expected. And JC Penney's stock fell to an all-time low after a disastrous second quarter report. Ron, we'll get to Macy's and JC Penney. Nordstrom's stock hitting a 52-week high this week, and they are they earned it.

Ron Gross: They earned it. I've always thought that Nordstrom was the best in breed here. But, it's a tough business, and remains a tough business. Department stores invariably all go out of business or go bankrupt at some point and then reorganize. We may be seeing that soon with the likes of JC Penney. But Nordstrom, a great job. Best quarterly same-store sales growth in three years. Love to see that. Online sales up 23%, now 34% of total sales, which is up nicely, and they consistently are getting that number up. Very important. Comp sales of 4%. That's a pretty big number. Both strong, in the full-priced stores as well as the Nordstrom Rack stores. They're doing a great job. Stock has severely underperformed the market over the last five years, as all of these stocks have done, but they're still doing a nice job -- right at this very moment. They're doing a nice job.

Hill: Well, Macy's stock is up about 80% over the past year, and they did everything this quarter that you would want, in terms of the report they put up and raising guidance. Was the sell-off in Macy's stock simply a valuation play there? Because people looked at it and said, "Wait a minute, we can't push this thing higher and have it double in a year?"

Gross: The answer is yes. [laughs] That is the reason. It's funny, though, because the stock's 9X earnings. It's funny to call that overheated. But, they did have a nice run, as you said, from a stock perspective. And they did everything they really needed to do. Kudos to them for closing underperforming stores and cleaning up inventory and raising prices. You can't ask much more than that. But, again, department stores is a tough business. 

Hill: JC Penney has been without a CEO since May.

Gross: Is that a problem? [laughs]

Hill: It really does seem like a problem, when you look at how JC Penney's business is performing. Is it safe to assume that whoever they bring in to be CEO, that that person's main job is to execute some sort of transformation for the business? Not necessarily overhauling it, but essentially preparing it for either bankruptcy or some sort of take-over? Because I don't imagine a CEO coming in and saying, "I really want to roll up my sleeves and make this business work." They're taking on water on so many fronts.

Gross: Agreed. And you could point to the Macy's model and say, just do what they did. Close the stores that aren't working, keeping the ones that do, clean up the inventory. But it just seems like an insurmountable battle here for JC Penney. We've been saying this for a very long time. They keep losing money, quarter after quarter. They have a little spark of light, and then it just fizzles out. I don't think this is bound for a turnaround probably ever.

Chris Hill has no position in any of the stocks mentioned. Ron Gross has no position in any of the stocks mentioned. The Motley Fool recommends Nordstrom. The Motley Fool has a disclosure policy.